IEA raises global crude oil supply forecast and questions Russian production capacity.

The International Energy Agency (IEA) increased its expectations for global crude oil supply growth for this year in its monthly oil market report released on Friday, citing the impact of the latest production decisions by OPEC+. The IEA forecasts that global crude oil supply will increase by 2.1 million barrels per day by 2025, an increase of 300,000 barrels per day from previous forecasts. OPEC+ had previously decided to gradually unwind the latest round of production cuts starting in April, and accelerated the pace of production increases for May, June, July, and August to inject more oil into the market. At the same time, the IEA lowered its demand expectations, noting a significant slowdown in oil consumption in recent months. However, the IEA pointed out that the increase in refinery processing volumes to meet summer travel and electricity demand is tightening the market. The agency stated, "Price indicators also show that the actual crude oil market is tighter than the surplus shown in our supply-demand balance table." Furthermore, the IEA stated in the report that the dwindling crude oil and petroleum product exports from Russia have raised doubts about its ability to maintain current production capacity. The IEA stated, "The volume of Russian crude oil and refined oil products exports in June remained at exceptionally weak levels, the lowest in the same period in five years." The agency added that these export volumes have been declining continuously since early 2024 and 2025, raising questions about whether Russia can maintain its upstream production capacity. According to IEA data, Russia's daily average crude oil shipment volume remained stable at 4.68 million barrels last month, while the daily average export volume of refined oil products decreased by 110,000 barrels to 2.55 million barrels. As one of the three major oil-producing countries globally, Russia imposed secrecy measures on its crude oil production and export data following the outbreak of the Russia-Ukraine conflict, making independent assessments of its upstream industry challenging. In addition to the IEA report, market observers rely on shipping tracking data, refinery operating estimates, and evaluations of Russia's compliance with OPEC+ production quotas to understand the true performance of its oil industry. Shipping tracking data shows that Russia's seaborne crude oil exports fell to their lowest level since February last month. However, it is estimated that despite being in a seasonal maintenance period, Russian refineries maintained high operating levels in June, further reducing the volume available for seaborne exports. Despite good refinery operating performance, Russia's refined oil exports fell to their lowest level in eight months in June. This trend is partly due to the Russian government encouraging domestic producers to retain gasoline and diesel domestically to meet the upcoming peak demand in the agricultural sector. According to Russia's own published data on compliance with OPEC+ quotas, it is gradually increasing production. This is because the alliance previously released tens of thousands of barrels of oil into the market, and Russia needs to compensate for its previous overproduction, resulting in a relatively slow pace of increase. Currently, the IEA has not adjusted its estimate of Russia's sustainable upstream production capacity and maintains it at 9.8 million barrels per day, which means the country can reach this capacity within 90 days and sustain it for an extended period. In comparison, Russia's crude oil production in June (excluding condensate) was 9.19 million barrels per day, exceeding its OPEC+ target for the month by 140,000 barrels per day. Furthermore, the IEA noted that despite a slight decrease in export volumes, Russia's oil export income in June increased by over $800 million month-on-month to reach $13.6 billion, a 6.4% increase from May.