EIA publishes January STEO
Published by Ellie Brosnan,
Editorial Assistant
Hydrocarbon Engineering,
Global oil prices
EIA expects oil prices to decline in 2026, as global oil production exceeds global oil demand, causing oil inventories to rise. Global inventories continue increasing into 2027, albeit at a slower pace. It forecasts the Brent crude oil price will average US$56/bbl in 2026, 19% less than in 2025, then average US$54/bbl in 2027.
Global oil production
EIA expects global production of liquid fuels to increase by 1.4 million bpd in 2026 and 0.5 million bpd in 2027. Global liquid fuels production growth in 2026 is driven by crude oil production growth in OPEC+, while production growth in 2027 is driven by countries outside of OPEC+, primarily in South America. The forecast assumes existing sanctions on Venezuela remain in place through 2027.
US crude oil production
After reaching an annual record of 13.6 million bpd in 2025, the EIA forecasts US crude oil production will decrease in the forecast, declining by less than 1% in 2026 and by 2% in 2027. With sustained lower crude oil prices, it is expected that crude oil production will decrease as the slowdown in drilling activity will outpace increases in drilling productivity. The West Texas Intermediate price averages US$52/bbl in 2026 and US$50/bbl in 2027 in the forecast, down from US$65/bbl in 2025.
US gasoline prices
Retail gasoline prices in the forecast for 2026 and 2027 are lower compared with 2025, which largely reflects the forecast of lower crude oil prices. EIA forecasts that US gasoline prices in 2026 will average just over US$2.90/gal., a decrease of nearly US$0.20/gal. from 2025. In 2027, it is forecasted for prices to remain mostly flat at an annual average of just over US$2.90/gal.
Natural gas prices
EIA expects the spot price of natural gas at Henry Hub to average just under US$3.50 per million Btu in 2026, down 2% from 2025, and average US$4.60 per million Btu in 2027. Natural gas prices increase in the forecast because growth in demand – led by expanding LNG exports and more natural gas consumption in the electric power sector – will outpace production growth.
Read the article online at: https://www.hydrocarbonengineering.com/refining/14012026/eia-publishes-january-steo/
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