October 7, 2026
Today, Tuesday, the US Energy Information Administration raised its oil price forecasts for the current and next years. Driven by the rapid decline in global inventories and the continued scarcity of supply in diesel markets, in light of the repercussions of the ongoing war on Iran.
The administration, affiliated with the US Department of Energy, stated in the “Short-Term Energy Outlook” report that the average price of Brent crude will reach about $98 per barrel in 2026, recording an increase of 8% compared to previous expectations. It is also expected that the average price of crude will reach about $105 per barrel during the fourth quarter, an increase of $14 from previous estimates.
This sharp rise in oil and fuel prices came as a result of the US-Israeli war on Iran, which disrupted the flow of oil through the vital Strait of Hormuz, which represented about 20% of global oil supplies before the outbreak of the conflict.
Regarding fuel prices in the local market, expectations indicate that retail prices for diesel in the United States will remain above the barrier of $6 per gallon during the month of October, before witnessing a gradual decline to reach an average of about $4.50 per gallon in 2027, noting that diesel prices had recorded record levels without precedents last month.
In terms of future supplies, the administration expects oil production and exports in the Middle East region to gradually recover, coinciding with the improvement of navigation traffic through the Strait of Hormuz, and producers’ reliance on alternative export routes and ship-to-ship transfers.
As supply flows restore and global inventories rebuild, the EIA expects the average price of Brent crude to stabilize at $84 per barrel in 2027, an increase of $10 from the previous forecast.
In the same context, the administration indicated that with the expansion of the use of alternative transportation solutions, the quantities of crude oil stopped from production will decrease from 4.5 million barrels per day in the fourth quarter of 2026, to reach 2.7 million barrels per day by the first quarter of 2027.
