Crude oil is expected to average $60 per barrel in 2026, the World Bank has revealed in its latest Commodity Markets Outlook.
This will be lower than the expected $68 per barrel in 2025, and will be favourable to inflation.
According to the report, prices are forecast to fall further in 2026, as oil consumption growth continues to moderate and oil supply continues to rise, before increasing to $65 per barrel in 2027.
The price increase in 2027, according to the report, reflects a projected rebalancing of the oil market, as low prices in 2026 curtail excess supply. These forecasts assume no major escalation in armed conflicts, weak demand growth relative to the 2015-19 average, a well-supplied oil market and stable OPEC+ production.
The report added that global oil supply is expected to increase significantly in 2025 and 2026, as new production continues to come online. Output in 2025 is projected to grow by 3.0 mb/d year-on-year (2.9%) to 106.1 mb/d, a new all-time high, and to 108.5 mb/d in 2026.
According to International Energy Agency (IEA) projections, nearly half of the 2025 increase is attributable to OPEC+, reflecting higher production targets. The IEA and other major oil market forecasting organizations project further supply growth in 2026, mainly in non-OPEC countries.
Global oil consumption is projected to expand only moderately in 2025 and 2026. The IEA anticipates an increase of approximately 0.7 mb/d in each year, whereas the U.S. Energy Information Administration forecasts a rise of 1.1 mb/d in both 2025 and 2026.
China and India are expected to account for one-quarter of global consumption growth in 2025 and two-fifths in 2026, according to the IEA. However, growth in China’s oil demand continues to be restrained by the rapid adoption of electric and hybrid vehicles, while demand in advanced economies is expected to remain broadly unchanged.
Brent crude is presently hovering around $63 per barrel.
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