Oil has returned to the centre of the global economic agenda in 2026. This does not mean the energy transition has reversed. It means that supply disruptions, depleted inventories and tight refined-product markets have demonstrated how strongly oil can still influence inflation, transport, industry and energy security.
Key Takeaway
The U.S. Energy Information Administration forecasts Brent crude to average $91 per barrel in 2026, up from $69 in 2025. According to calculations by BTU researchers, that is an increase of about 31.9%. The International Energy Agency, meanwhile, expects global oil demand to fall by 2.5 million barrels per day in 2026 but recover by 2.6 million barrels per day in 2027. High prices therefore reflect severe supply constraints as much as demand.
Why oil is back at the centre of the economy
The energy debate has increasingly focused on electric vehicles, renewables, batteries and electrification. Those trends remain intact. But 2026 has shown that the global economy still depends heavily on liquid fuels in road freight, aviation, shipping, petrochemicals and industry.
The IEA projects global oil supply to average 100.7 million barrels per day in 2026, down 5.7 million barrels per day from a year earlier. The fall in supply is large enough to keep markets tight even as demand contracts.
The Strait of Hormuz remains a key vulnerability
Oil-market risk is highly geographic. Disruptions around the Strait of Hormuz affect not only crude exports but shipping routes, insurance costs, delivery times and expectations about future supply. The EIA reported that Brent averaged $91 per barrel in August, $7 higher than in July, while global oil inventories had fallen by about 400 million barrels since the start of the year.
Why diesel matters
Crude oil is only part of the story. Refining capacity and product inventories determine the cost and availability of fuels used by households and businesses. The EIA expects U.S. distillate inventories to fall below 100 million barrels in September and remain below the 2021-2025 five-year low through the end of 2026 and much of 2027.
This matters because diesel is embedded in freight, construction, agriculture and industry. A diesel shortage therefore reaches the economy through logistics and production costs, not only through prices at fuel stations.
Does oil’s return mean the energy transition is reversing?
No. Short-term supply shocks and long-term structural change are different processes. Electrification and renewable energy can reduce oil dependence over time, but they cannot instantly replace liquid fuels in every sector. Aviation, shipping, heavy transport and petrochemicals remain especially difficult to substitute.
Oil can therefore lose long-term market share while remaining a powerful short-term macroeconomic variable. The events of 2026 illustrate precisely that distinction.
Georgia’s context
Georgia is highly exposed to international petroleum markets because it depends heavily on imported fuel. Preliminary Geostat data show that petroleum and petroleum-oil imports were worth $96.7 million in January 2026, equal to 8.6% of total imports and the country’s second-largest import commodity group after motor cars.
The corresponding January 2025 value was $107.6 million. According to calculations by BTU researchers, the import value fell by about 10.1% year on year. This does not mean physical fuel imports necessarily fell by the same amount because trade value reflects price, volume, product mix and purchasing conditions.
In January-August 2025, petroleum and petroleum-oil imports were worth $846.1 million, or 7.2% of total imports. The scale shows why international oil-price shocks can materially affect Georgia’s import bill and business costs.
How global oil prices reach Georgia
A 10% increase in Brent does not mechanically produce a 10% increase in Georgian retail fuel prices. The local price also depends on refined-product quotations, shipping, inventory timing, exchange rates, taxes and competition.
The exchange rate is particularly important. If oil rises in dollars while the lari weakens, the local-currency cost of imported fuel can face two sources of upward pressure at the same time.
BTU Researchers’ Assessment
According to an assessment by BTU researchers, the most important meaning of oil’s return is not an increase in its long-term share of the energy system. It is the renewed strength of its macroeconomic transmission mechanism. A disruption can still affect inflation, logistics, business costs, trade balances and the monetary-policy environment simultaneously.
For Georgia, the strategic objective is therefore not to predict oil prices perfectly. It is to reduce the economy’s vulnerability across different price scenarios through diversified supply, efficiency, transport electrification and better risk management.
Conclusion
Oil has returned to the centre of the global economic agenda. The 2026 supply shock demonstrates that the energy transition has not eliminated the short-term power of petroleum markets.
For Georgia, the lesson is practical. The country cannot control the global price of oil, but it can reduce the consequences of volatility by diversifying supply, improving energy efficiency, modernising transport and planning for fuel-market disruptions.
Data and Main Sources
International Energy Agency – Oil Market Report, September 2026
URL: https://www.iea.org/reports/oil-market-report-september-2026
Dataset: No
U.S. Energy Information Administration – Short-Term Energy Outlook, September 2026
URL: https://www.eia.gov/outlooks/steo/
Dataset: Yes
Georgia’s National Statistics Office, Geostat – External Merchandise Trade of Georgia, January 2026
URL: https://www.geostat.ge/media/76857/External-Merchandise-Trade-of-Georgia-in-January-2026.pdf
Dataset: Yes
This material is analytical and educational and does not constitute investment advice.
Prepared by the academic team of Business and Technology University and the BTUAI Research Team, Tbilisi, Georgia.