The EIA projects US Crude production to peak at 13.87 million b/d in October before easing in 2026, while a global supply surplus of 2 million b/d is expected to push Brent prices down to $55. Strategic reserve builds in China and underperformance from OPEC+ may provide some support, Commerzbank's commodity analyst Carsten Fritsch notes.

China, OPEC+ could limit oversupply

"In its Short-Term Energy Outlook published this week, the US Energy Information Administration revised its forecast for US Crude Oil production in 2025 slightly upward and its projection for next year slightly downward. Production reached a record high of 13.87 million barrels per day in October, where it is expected to remain until the end of the year before starting to decline in early 2026."

"The EIA continues to expect a supply surplus of around 2 million barrels per day on the global Oil market next year, which is why the price of Brent Crude Oil is projected to fall to an average of USD 55 per barrel. According to the EIA's assessment, China is likely to continue to build up its strategic Oil reserves next year, and OPEC+ is expected to fall well short of its target production level."

"Both factors are likely to limit the oversupply. Thus, despite predominantly bearish news, the EIA report also contained a few silver linings."