Expectations for a Sharp Decline in Oil Prices in the Coming Months

SadaNews - The U.S. Energy Information Administration, in a report released today Tuesday, expected global oil prices to decline significantly in the coming months, as the increase in production by OPEC+ member countries will lead to a large accumulation of oil inventories.

The Energy Information Administration stated in the report that oil inventories are expected to rise by an average of 2.1 million barrels per day in the second half of 2025 and will remain elevated until the following year.

The report was finalized before the OPEC+ coalition made its decision earlier this week to increase production in October.

For her part, an executive from Maersk shipping company stated at a conference in Singapore today that there is a high likelihood of declining oil prices due to the modest increase in demand and the rise in OPEC+ production.

Emma Mozehri, the CEO of oil trade at Maersk, mentioned at the Asia-Pacific Petroleum Conference (APEC) "I believe there is a significant chance for prices to trend downward considering the overall global balances."

Last Sunday, Goldman Sachs predicted a slightly larger oil surplus in 2026, as increases in supply from the Americas overshadow the anticipated losses from Russian supply and the global demand increase.

The U.S. investment bank maintained its forecast for the average price of Brent/WEST Texas Intermediate unchanged for 2025, predicting an average price of $52 to $56 per barrel in 2026.

Oil prices rose today Tuesday by more than 1% after the Israeli army announced the execution of an attack targeting leaders of the Palestinian Islamic Resistance Movement (Hamas) in the Qatari capital, Doha.

Futures rose by about 1% to $66.76 per barrel before receding slightly during today’s trading, while futures for West Texas Intermediate crude rose by 0.59%, settling at $62.63 per barrel.

Eight OPEC+ members agreed on Sunday to increase production starting October by 137,000 barrels per day.

This is far less than the monthly increases that approached 555,000 barrels per day for September and August, and 411,000 for July and June.

Source: Reuters