Brent price to average $78/bbl in 2025 – EIA

A persistent slowdown in global oil demand growth is expected to keep the Brent crude oil spot price below $80/bbl in 2025, the EIA said in its latest oil market report.

PHOTO: Oil barrels with a US dollar symbol. Getty Images

The US Energy Information Administration (EIA) now projects that Brent spot price will average around $78/bbl in 2025, a decline of $7/bbl from its previous forecast.

“Following the September drop in prices and our expectation that oil demand growth will be lower next year than we had previously forecast, we have lowered our forecast for crude oil prices,” the EIA said.

Global oil inventories fell by 800,000 b/d in the third quarter of 2024. The inventories are expected to decline by 600,000 b/d through the first quarter of 2025, the EIA said in its October short-term energy outlook (STEO) report.

The US-headquartered energy agency projects that the global oil inventory level will improve by mid-2025 as OPEC+ gradually rolls back its voluntary cuts and non-OPEC supply increases.

“We forecast oil inventories will increase by an average of almost 0.6 million b/d in 2H25 [600,000 b/d in the second half of 2025],” as global oil production gradually begins to outweigh oil demand, the EIA said.  

Supply and demand estimates

Global liquid fuels and petroleum production is expected to grow by 200,000 b/d in 2024 to about 102.5 million b/d, down from the previously expected growth of 300,000 b/d, the EIA said. However, production growth from non-OPEC+ countries, including the US, Canada, Guyana and Brazil, will remain strong in 2025, it added.

In addition to voluntary cuts to OPEC+ production, a force majeure in Libya in August and September reduced oil production. “As of early October, it appears the cause of the disruption has come to a resolution,” with production restarting this month, the EIA said. The energy agency expects Libya’s oil production to average 600,000 b/d for the rest of this year.

Global liquid fuels output is expected to increase by 2 million b/d in 2025 to 104.5 million b/d, the EIA said. “We assume countries outside of OPEC+ increase production by 1.4 million b/d next year, while OPEC+ production increases by 0.7 million b/d [700,000 b/d,” it added.

The US energy agency forecasts global liquid fuel demand to average at 103.06 million b/d in 2024, down by 20,000 b/d from its previous forecast. It has also reduced its 2025 demand growth projection by 200,000 b/d to about 104.4 million b/d.

Global oil demand growth continues to face headwinds from the apparent economic slowdown in China, as well as reduced consumption in the OECD group of developed nations, the EIA said.

“We reduced our forecast for China’s liquid fuels consumption in 2024 because of continued declines in the country’s [China’s] crude oil imports and refinery runs in 3Q24 [third quarter of 2024],” the energy agency added.

Consumption of liquid fuels in China is now expected to grow by about 100,000 b/d in 2024 and about 300,000 b/d in 2025, which is lower than the average growth of 500,000 b/d achieved in 2015–2019.

By Aparupa Mazumder

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