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Informist, Wednesday, Jan. 14, 2026

 

MUMBAI – The US Energy Information Administration expects Brent crude oil price to average $56 per barrel in 2026 and $54 per barrel in 2027, compared with an average of $69 per barrel in 2025. The downward revision in forecast is driven by high global oil production causing oil inventories to rise, the agency said in its Short-term Energy Outlook for January.

 

As for West Texas Intermediate crude oil on the New York Mercantile Exchange, the US energy agency now expects prices to average $52.21 per barrel this year. In 2027, the agency expects WTI prices to average $50.36 per barrel.

 

Strong global oil production growth outpaced consumption growth, resulting in a rapid increase in global oil inventories during the second half of 2025. Inventory builds are expected to continue in 2026 and 2027, although at a slower pace in 2027 as supply growth moderates and global oil demand growth increases to 1.3 million barrels per day from 1.1 million barrels per day in 2026, the agency said. The global oil inventory builds will average 2.8 million barrels per day in 2026, which is similar to this year's increase, before averaging 2.1 million barrels per day in 2027, it said.

 

EIA expects global production of liquid fuels to rise by 1.4 million barrels per day in 2026 and 500,000 barrels per day in 2027. Global liquid fuels production growth in 2026 is driven by crude oil production growth in the Organization of the Petroleum Exporting Countries, while production growth in 2027 is driven by countries outside of OPEC and its allies, primarily in South America. "Global liquid fuels production growth comes almost entirely from non-OPEC+ countries in 2027 as OPEC+ targets are assumed to remain at 2026 levels and the group's production levels are largely unchanged," the agency said.

 

In 2026, the agency sees global liquid fuels consumption to increase by 1.1 million barrels per day in non-Organisation for Economic Co-operation and Development countries and another 1.2 million barrels per day in 2027, making up nearly all of global liquid fuels consumption growth. "Most non-OECD growth is concentrated in Asia. We expect liquid fuels consumption in India will increase by almost 0.3 million b/d (barrel per day) in both 2026 and 2027," the agency said.

 

The geopolitical tensions in Venezuela remain key uncertainty to the agency's forecast. The oil blockade and the interception of sanctioned oil tankers near Venezuela halted most of Venezuela's oil exports, resulting in production shut-ins. The agency estimates 600,000 barrels per day of Venezuela's oil exports are currently disrupted, and an equivalent amount of production has been shuttered. The agency assumes that the sanctions on Venezuela remain in place throughout its forecast. "Any sanctions relaxation or other US government policy changes related to Venezuela that could result in more oil production than we assumed in this forecast would put additional downward pressure on oil prices," the agency said.

 

At 1318 IST, the most active March contract of Brent Crude on the Intercontinental Exchange was down 0.5% at $64.99 per barrel and the most active February contract of crude oil on the NYMEX was down 0.6% at $60.77 per barrel. End

 

US$1 = INR 90.22

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Reported by Reshma Ravi

Edited by Deepshikha Bhardwaj

 

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