EIA raises 2025 oil price forecast

The U.S. Energy Information Administration (EIA) revised upward its average price forecast for Brent and WTI for this year in its "September 2025 Short-Term Energy Outlook." Prices are expected to decline in the final quarter of the year as summer demand weakens and supply increases, while 2026 projections remain largely unchanged.

PRICE ESTIMATES REVISED UP

Despite the rise in global oil inventories, prices haven't declined significantly, according to the EIA. The agency updated Brent to $67.80/barrel (previously $67.22) and WTI to $64.16/barrel (previously $63.58) for the 2025 average.

DECLINE IN THE LAST QUARTER OF THE YEAR

The report predicted that prices could fall to $59 in the last quarter of the year as demand, which strengthened during the summer months, normalizes and global supply increases. Prices are expected to fall to $49 in the spring of 2026.

The EIA maintained its average price forecasts for next year: Brent $51.43/bbl, WTI $47.77/bbl.

Stocks and Market Balance

A portion of the surplus production in recent months has been channeled into strategic reserves or domestic stockpiles in countries like China. OECD stockpiles have risen above the seasonal average, and after summer demand, stockpiles are expected to approach the upper end of the five-year average by the end of 2026.

OPEC+ IMPACT

The EIA notes that tensions between Russia and Ukraine, the possibility of new sanctions, and US trade negotiations pose risks to the supply-demand balance. It notes that if the price decline becomes persistent, OPEC+ and other producers may reduce supply, which could slow the rate of inventory growth later in 2026.

PRODUCTION EXPECTATION IN THE USA

US crude oil production is projected to average 13.44 million barrels per day in 2025 (2024: 13.23 million barrels per day). Production for 2026 is forecast at 13.30 million barrels per day.

This year, global supply is expected to be 105.54 million barrels per day, while global consumption is expected to be 103.81 million barrels per day. In 2026, global supply is expected to rise to 106.64 million barrels per day, while consumption is expected to rise to 105.09 million barrels per day.

Source: Headline News