The U.S. Energy Information Administration (EIA) has raised its crude oil price forecast by $2 per barrel through the end of 2025, citing expectations of stronger global oil demand growth in the coming year.
According to the EIA’s recently released Short-Term Energy Outlook (STEO), the Brent crude oil spot price averaged $76 per barrel in November, marking a $2 increase from September levels.
The EIA identified two key factors contributing to the uncertainty surrounding future oil prices: the ongoing conflict in the Middle East and the commitment of OPEC+ members to continue their voluntary production cuts.
“Although the volatility and risk premium associated with the Middle East conflict has eased in recent weeks, the duration and potential for escalation remain uncertain,” the EIA report noted. “This uncertainty could affect oil supplies. Additionally, while OPEC+ producers are expected to maintain production limits through 2025, any weakening commitment to production cuts could introduce downward pressure on prices.”
Looking ahead to next year, the EIA projects that Brent crude will average $76.06 per barrel, while West Texas Intermediate (WTI) is expected to average $71.60 per barrel.
On the production front, the EIA forecasts U.S. crude oil output to reach 13.53 million barrels per day (bpd) in 2025, slightly revised downward by about 10,000 bpd from previous predictions.
Global oil production is expected to total 102.62 million bpd by the end of this year, with a further increase to 104.66 million bpd in 2025. Meanwhile, global oil demand is projected to reach 104.35 million bpd next year, signaling a robust demand recovery as global markets continue to recover.