EIA: Crude oil prices to fall as global inventories rise

The international benchmark Brent crude oil price is expected to fall to about $60 per barrel by the end of the year and average about $59 per barrel in 2026, according to the U.S. Energy Information Administration (EIA).

On Tuesday (June 10), the EIA released its June Short-Term Energy Outlook that shows the low price of crude oil will affect U.S. crude oil production and retail gasoline prices in the short term.

U.S. crude oil production is expected to decrease to about 13.4 million barrels per day in 2025, narrowly below record highs earlier this year. The production reached a record high of 13.5 million barrels per day in the second quarter of 2025. The production is projected to fall through the end of 2026 as oil producers respond to lower prices.

Baker Hughes data shows the number of active drilling rigs declined last month by more than EIA had expected. Fewer active rigs affect EIA’s forecast for how many wells U.S. operators will drill and complete throughout 2026. In 2026, production is projected to be slightly lower than 2025 levels.

The EIA attributed a rise in global oil inventories as the primary driver of the oil price decline through this year and next year. Global oil production is expected to rise slightly faster than the EIA previously projected, while global petroleum products consumption is not as strong as initially expected, resulting in a rise in global oil inventories. The inventories are projected to rise by about 800,000 barrels per day in 2025 and 600,000 barrels per day in 2026.

U.S. retail gasoline prices are expected to average less than $3.10 per gallon through the end of 2026, which is about 6% lower than the 2024 average price. Retail gasoline prices in the eastern United States are expected to remain below $3 per gallon for most of the following year and a half. On the West Coast, refinery capacity reductions are expected to result in a 4% annual price increase next year.

Following are other highlights from the June outlook.
• The Henry Hub natural gas spot price is expected to average about $4 per million British thermal units in 2025 and $4.90 per million British thermal units in 2026, compared with $2.20 per million British thermal units in 2024.

• Electricity demand is expected to increase in 2025 about 1% faster than EIA previously projected amid greater expected demand growth in the commercial and industrial sectors, particularly from data centers and manufacturing operations. The rise in power demand is especially notable in the regions managed by the Electricity Reliability Council of Texas and PJM independent system operators. U.S. commercial sector electricity consumption is expected to rise by 3% in 2025 and by 5% in 2026.

• U.S. electricity generation this summer will be about 1% greater than last summer. Higher natural gas prices this summer will lead to less generation from natural gas-fired power plants compared to last summer, which is expected to be offset by more generation from coal, solar and hydro.