OPEC, EIA outlooks point to higher oil production this year but slower growth in 2026

[Data analyzing in commodities energy market: the charts and quotes on display. US WTI crude oil price analysis. Stunning price drop for the last 20 years.]
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OPEC raised its expectations Tuesday for global oil demand growth next year while also lowering the supply growth forecast for producers outside the wider OPEC+ group, signaling a tighter oil outlook, and the U.S. Energy Information Administration expects U.S. output to decline in 2026.

OPEC's latest monthly report said global oil demand will rise by 1.38M bbl/day in 2026, up by 100K bbl/day from its previous forecast, while supply from producers outside of the wider OPEC+ alliance is expected to rise by 810K bbl/day this year but by just 630K bbl/day next year.

The EIA's latest forecast sees U.S. crude production hitting a record 13.41M bbl/day in 2025 due to increases in well productivity, but lower oil prices will result in a decline in 2026 to 13.28M bbl/day, which would be the first drop in output since 2021 for the world's largest producer.

The EIA also predicted prices for Brent crude will average $51/bbl next year, down from its prior forecast of $58/bbl, citing the OPEC+ decision to accelerate the pace of production increases.

Meanwhile, crude oil futures fell in light trading Tuesday, with the market’s main focus on Friday’s highly anticipated meeting of Presidents Trump and Putin that could keep Russian barrels flowing.

The summit is "the biggest thing," Phil Flynn of the Price Futures Group said in a note. "It could be transformational from the viewpoint that if they get a ceasefire, there will be pressure on Europe to lift sanctions."

But working out the details will be difficult, and "on the flip side, if the talks fall apart that could be a catalyst for a big move across the board" for oil, as additional U.S. sanctions on Russia may further tighten already low diesel supplies, with the risk of a spike in prices.

Trump's extension of the trade truce with China for another 90 days has eased pressure on oil futures, alleviating concerns that an escalating trade war between the world’s two largest economies could hurt global economic activity and the demand for crude, analysts said.

Front-month Nymex crude (CL1:COM [https://seekingalpha.com/symbol/CL1:COM]) for September delivery closed -1.2% to $63.17/bbl, and front-month Brent crude (CO1:COM [https://seekingalpha.com/symbol/CO1:COM]) for October delivery finished -0.7% to $66.12/bbl, the seventh loss in nine sessions for both benchmarks and the lowest since early June.

U.S. natural gas futures (NG1:COM [https://seekingalpha.com/symbol/NG1:COM]) fall for the fourth straight session, as high production and forecasts for a cooler second half of August maintained concerns about surplus inventories; the front-month Nymex September gas ended -4.9% to $2.808/MMBtu.

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