U.S Energy Agency Forecasts Lower Oil Prices in 2025
The US Energy Information Administration (EIA) has revised down Brent crude price forecast for 2025 on the expectation that, production, inventories will increase. In February, the average Brent crude oil price was $75 per barrel, marking a $4 decrease from January and $8 lower than the same time last year.
The price decline was largely driven by economic growth concerns tied to potential tariffs from the US and other trade partners, according to the EIA’s Short-Term Energy Outlook (STEO) released late Tuesday.
The agency forecasts that global oil markets will remain relatively tight through the middle of 2025 before gradually shifting to oil inventory builds later in the year.
‘We expect global oil inventories will fall in the second quarter of 2025 in part due to decreasing crude oil production in Iran and Venezuela.
“As a result, the Brent crude oil spot price in our forecast rises from about $70 per barrel to $75 per barrel by the third quarter of the year,’ the EIA said.
However, the agency anticipates that oil inventories will increase, exerting downward pressure on crude oil prices in late 2025 and throughout 2026, as OPEC+ is expected to unwind production cuts and non-OPEC oil production rises.
As a result, the EIA forecasts that average Brent oil prices will be $74.22 per barrel, while the American West Texas Intermediate (WTI) is expected to trade at $70.68 per barrel in 2025. In the previous month’s report, these figures were $74.50 and $70.62 respectively.
For 2024, the agency had reported an average price of $80.56 per barrel for Brent crude and $76.60 per barrel for WTI. Crude oil production in the US is expected to average 13.61 million bpd in 2025, up from 13.22 million bpd last year. The figure is around 20,000 bpd higher than the previous month’s forecast.
The agency also estimated that the average global oil production will be 104.17 million bpd at the end of the year. Global oil demand, meanwhile, is anticipated to reach 104.13 million bpd in 2025. #U.S Energy Agency Forecasts Lower Oil Prices in 2025 Honeywell Flour Mills Sees Early Price Surge of 10%
