EIA nudges Brent price outlook higher
The US Energy Information Administration (EIA) projects the Brent crude spot price to average around $62/bbl in the fourth quarter of this year, $3/bbl higher than its previous forecast.
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Despite the slight upward revision, Brent’s price is expected to remain under “significant downward pressure” in the coming months, largely due to rising global oil inventories as OPEC continues to hike production, the EIA said in its latest oil market report.
The EIA expects Brent crude’s price to average around $52/bbl in 2026, $1/bbl higher than its previous projection.
The forecasts follow continued output increases by OPEC+ producers seeking to regain their market share. Earlier this month, eight members of the coalition agreed to collectively increase their production by another 137,000 b/d in November, marking the group's seventh consecutive output hike.
The US energy agency expects global oil inventories to increase by an average of 2.1 million b/d in 2026, compared with an estimated annual average rise of 1.9 million b/d this year. Inventory builds will be the highest in the first quarter of 2026, averaging more than 2.7 million b/d, it said.
Growing global oil supply will result in “significant growth in global oil inventories over the forecast, causing crude oil prices to fall in the coming months,” the energy agency said in its September short-term energy outlook (STEO) report.
The pace at which China, the world's second-largest oil consuming nation, continues to purchase oil for inventory builds will be a key factor in determining future prices, the EIA said.
“If China’s builds continue at the pace estimated in recent months, crude oil prices could be higher than in our forecast,” it added.
Inventory builds are expected to moderate later in 2026 due to some demand growth and “slightly lower” oil production, both in response to lower oil prices, the agency added.
Supply and demand estimates
Global liquid fuels and petroleum production is expected to grow by 2.7 million b/d to reach 105.9 million b/d in 2025, about 400,000 b/d higher than the previous estimate, the EIA said.
Countries outside of OPEC+ are expected to increase total liquid fuels production by 2 million b/d in 2025 – 300,000 b/d higher than the EIA’s previous forecast. Brazil, Canada, Guyana and the US will lead the increase, the agency noted.
“We expect countries outside of OPEC+ to lead our forecast total liquids production growth,” the agency said.
OPEC+ liquid fuels production is expected to average around 33.5 million b/d this year. The Saudi Arabia-led coalition will further increase production by another 200,000 b/d to reach 33.7 million b/d in 2026, the US-based agency projected.
Notably, “recent production increases due to higher OPEC+ targets will moderate as some members reach the practical limitations of their output,” the EIA said.
The US energy agency forecasts global liquid fuels demand to grow by 1.1 million b/d in both 2025 and 2026, to average around 104 million b/d and 105 million b/d, respectively.
Oil demand growth will be driven “almost entirely” by non-OECD countries including China and India, the US agency remarked.
By Aparupa Mazumder
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