The three major oil market research institutions have published their latest forecasts for demand, supply and projected prices per barrel of oil in 2025.
Table of contents:
- US Energy Information Administration (EIA) report
- International Energy Agency (IEA) report
- OPEC report
- Summary
US Energy Information Administration (EIA) report
The latest short-term and medium-term forecast from the US Energy Information Administration (EIA) indicates key trends in the global energy market for 2025-2026.
The EIA predicts that Brent crude oil prices will decline in the coming years, mainly due to global supply outstripping demand. The average price of a barrel is expected to be $74 in 2025, down almost 10 percent, and reach $66 in 2026 (down 11 percent).
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At the same time, oil production is projected to increase by 1.8 million barrels per day (up 1.8 percent year-on-year) in 2025 and by a further 1.5 million b/d in 2026. The main drivers of this growth will be non-OPEC+ countries, including the United States, Brazil and Canada. The biggest impact on supply will come from increased oil production in the US, where it is already reaching its historic levels.
Source: EIA
World oil consumption will increase moderately by 1.3 million barrels per day (up 1.2 percent year-on-year) in 2025 and by 1.1 million b/d in 2026, which will be slower than the projected rate of production growth. Demand growth will be driven mainly by non-OECD countries, with India leading the way, while demand in developed countries will remain stable.
EIA forecasts for 2025-2026 assume further declines in oil prices, moderate fuel demand growth and stabilisation of global production. At the same time, the energy sector will become increasingly dependent on renewables, especially solar. The US will remain the world's largest individual oil producer.
International Energy Agency (IEA) report
According to a report by the International Energy Agency (IEA), the global oil market is entering the new year with intense changes, driven by both seasonal and geopolitical factors. Increased demand, changing weather conditions and economic sanctions are having a significant impact on the market, creating new challenges and opportunities.
The IEA notes that the final quarter of 2024 saw a seasonal increase in global oil demand of 1.5 million barrels per day (mb/d), the highest level since the fourth quarter of 2023. Forecasts for this year point to a further increase in demand of 1.05 million mb/d, almost half the increase forecast by US institutions.
Global oil production increased in December 2024, reaching 103.5 million barrels per day. The IEA predicts that production will increase by a further 1.8 million b/d in 2025. Like the US Energy Agency (EIA), the IEA also notes that non-OPEC+ production growth will be particularly significant, reaching 1.5 million barrels per day in 2025 as well, led by the US, Brazil, Canada and Argentina.
Global oil stocks rose by 12.2 million barrels in November, but stocks in OECD countries fell to their lowest level since August 2022. New US sanctions on Iran and Russia may further affect global oil flows. Severe weather conditions in North America may in turn limit production, particularly in cold-sensitive regions. Despite these challenges, production increases in non-OPEC+ countries and potential production increases by the alliance are expected to meet both rising demand and potential supply disruptions.
Source: EIA
The IEA, like its US counterpart, notes that demand growth is unlikely to keep pace with the increase in oil production, which will be driven mainly by the US. In addition, in 2025 there is a high probability that OPEC countries will abandon their existing production cuts. Such a situation could lead to noticeable declines in oil prices in the coming quarters.
OPEC report
In its monthly oil market forecasts, the OPEC cartel, which accounts for around a third of global production, provides key predictions for the future of the sector.
Global economic growth is expected to be 3.1 percent in 2025 and 3.2percent in 2026. The main drivers of this growth will be the US, China and India, which will also be reflected in rising oil demand.
In its report, OPEC forecasts that global oil demand will increase by 1.4 million barrels per day in 2025, of which 1.3 mb/d will come from non-OECD countries. In 2026, demand is expected to increase by a further 1.4 mb/d, mainly from countries in Asia, the Middle East and Latin America. Transport growth and increased industrial activity in developing regions will be key.
OPEC is also forecasting the lowest oil production growth among the market research institutions at 1.1 mb/d per annum between 2025 and 2026, with the US, Brazil, Canada and Norway expected to be the largest contributors.
Like the International Energy Agency (IEA), OPEC notes that by the end of 2024, global oil stocks in OECD countries have fallen to levels below the 2015-2019 average.
Unlike other institutions, OPEC forecasts more stability in the oil market. Balance is expected to be maintained with an emphasis on efficiency and supply stability.
Summary
Forecasts for 2025-2026 indicate that the global oil market will be characterised by production increase and moderate demand growth, which could lead to further price declines. The EIA predicts an average Brent crude price of US$74 per barrel in 2025 and falling to US$66 in 2026. The US, Brazil and Canada will remain the main drivers of production growth. The IEA points to possible geopolitical and seasonal effects that could affect the market, and the potential lifting of production restrictions by OPEC. OPEC, on the other hand, expects more stability with a focus on supply balance and efficiency. Despite the challenges, developing economies, particularly in Asia, will continue to drive oil demand growth.
Grzegorz Dróżdż, CIIA, Market Analyst of Conotoxia Ltd. (Conotoxia investment service)
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