EIA raises 2026 oil price outlook after Middle East output losses

The U.S. Energy Information Administration said the Iran war has cut global oil stocks by an estimated 400 million barrels this year and expects further declines by year-end amid the continued absence of significant Middle East output and exports. In its Wednesday Short-Term Energy Outlook, the agency said Middle East oil production shut-ins rose to 6.7 million bpd in August from 5 million bpd in July, partly because of attacks on Saudi oil exports through Bab el-Mandeb and fewer ship departures from Yanbu port. The EIA now sees Brent crude averaging about $91 a barrel in the spot market in 2026, nearly 5% above its prior forecast.

It also projects WTI to average $84.65 a barrel, a similar percentage increase from earlier estimates. “$74/b in 2027,” the EIA said. The agency said Middle East oil flows are expected to recover in the coming months, but that timing depends on how the conflict develops. The report was finalized on September 3, before the latest rise in U.S.-Iran tensions, when Brent crude climbed above $100 a barrel on Wednesday after attacks on shipping and energy infrastructure.

On Monday, Goldman Sachs lifted its oil-price forecasts, saying Brent could rise above $120 a barrel if Persian Gulf supply disruptions continue. It said the increase would still be relatively moderate, citing stable OECD inventories and continued flows through the Strait of Hormuz and alternative pipelines. The President said gasoline would start “tumbling downward” after the midterm election, while adding that relief could take “a little bit longer than the midterms.” He said, “I think for gasoline, we’ll get them below $2 a gallon.

But not until after the midterms.” At the time of writing, Brent crude oil futures expiring in October were 4.39% higher at 105.65 per barrel, and WTI crude futures expiring in October were 3.48% higher at 99.39 per barrel.