Crude oil prices fell in 2025 amid oversupply

On a monthly average basis, the price of Brent crude oil declined from a high of US$79/bbl in January to a low of US$63/bbl in December, which was the lowest monthly average price since early 2021. The annual average price was US$69/bbl, the lowest since 2020, even when adjusting for inflation.

In 1H25, crude oil prices declined in response to slowing economic activity, which can affect global oil demand. Prices decreased in 1Q25 with a contraction in US GDP, and prices fell nearly US$15/bbl further in April amid expectations that escalating tariffs among large economies could continue to slow economic growth.

In 2H25, OPEC+ announcements that increased crude oil production targets for the group increased the prospect of an oversupplied market. In the EIA’s most recent Short-Term Energy Outlook, it is estimated that global production of crude oil and liquid fuels outpaced consumption throughout 2025, with implied stock builds of more than 2.5 million bpd in the final two quarters of the year. These stock builds were the largest recorded since 2000, aside from in 2020.

Generally, crude oil prices tend to decrease as global petroleum stocks increase. However, crude oil inventory builds in China likely limited price declines from the stock builds, essentially acting as a source of demand by removing barrels from the global market.

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