EIA raises oil price forecast for this year as Iran war drives global stocks down by 400 million barrels
CommodityMacroGeopolitics Impact 4
The U.S. Energy Information Administration, or EIA, has raised its oil price forecasts for this year and next, as global oil inventories fall rapidly under pressure from supply losses in the Middle East caused by the ongoing war with Iran. In its Short-Term Energy Outlook published on Wednesday, September 9, the EIA said global oil inventories have already fallen by about 400 million barrels this year and are likely to keep declining through the end of the year. The EIA expects Brent crude to average about 91 dollars per barrel in the spot market this year, nearly 5 percent higher than its previous forecast for 2026. U.S. West Texas Intermediate crude is expected to average 84.65 dollars per barrel this year, also nearly 5 percent above the earlier forecast. The EIA said the volume of oil production that has had to be shut in across the Middle East rose to 6.7 million barrels per day in August from 5 million barrels per day in July. Attacks on Saudi Arabia's oil exports through the Bab el-Mandeb Strait, along with a decline in vessels leaving the port of Yanbu on the Red Sea, contributed to the higher shut-in volumes. The agency expects Middle East shut-in production to average around 5.7 million barrels per day in the fourth quarter of 2026, and added that production and exports from the region will not return to pre-conflict levels until the second quarter of 2027. The forecasts come as the conflict between Iran and the United States intensifies, with both sides launching their largest tanker attacks in six months. Iranian authorities said on Wednesday that they had attacked 10 vessels near the Strait of Hormuz, while the U.S. military sank five Iranian oil tankers in retaliation for Iranian attempts to strike U.S. warships, marking an escalation in the exchanges between the two sides and pushing Brent crude futures above 100 dollars per barrel for the first time since July.
