EIA Forecasts Global Oil Production Recovery and Revised Brent Prices
The U.S. Energy Information Administration (EIA) released a report on Tuesday indicating that global crude oil production is expected to return to pre‑war levels by the end of 2026. This timeline is faster than earlier projections, which had anticipated that flows through the Strait of Hormuz would normalize only by early next year and that some Middle‑East production would remain disrupted for several years following the Iran war.
The agency noted that most shut‑in production resulting from the conflict is slated to resume during the first quarter of 2027, accelerating the overall recovery. The report described the war‑induced supply disruption as the biggest in history, while acknowledging that some vessels continue to face attacks while transiting the Strait of Hormuz.
Market participants are preparing for a near‑term supply surplus as barrels previously held in the Persian Gulf become available to buyers. In line with the revised supply outlook, the EIA lowered its Brent crude price forecast to an average of $74 per barrel for the third quarter of 2026 and $65 per barrel for 2027, revising down from an earlier expectation of $79 per barrel in 2027.
Brent crude was trading around $74 per barrel on Tuesday morning, reflecting the updated expectations. The article was generated with AI assistance and reviewed by an editor.