EIA Projects Brent Crude to Average USD 85 in Q3 2026, Fall to USD 69 in 2027

New Delhi, August 26, 2026; Global crude oil prices are likely to stay firm in the near term before declining next year as oil production in the Middle East gradually returns to normal, according to the US Energy Information Administration’s (EIA) latest Short-Term Energy Outlook.

The EIA has projected the average Brent crude price at about USD 85 per barrel during the third quarter of 2026. However, the agency expects the benchmark to decline significantly in 2027, with an average price of around USD 69 per barrel.

The near-term outlook remains influenced by disruptions to oil flows through the Strait of Hormuz. According to the EIA, restrictions on shipments through the key maritime route have contributed to tighter global oil supplies and prompted the agency to increase its estimate of Middle East production losses from its previous forecast.

The agency expects crude production in the region to move closer to pre-conflict levels during the early part of 2027. Even so, production is projected to remain around 600,000 barrels per day below normal levels through the end of next year.

The forecast comes after considerable volatility in crude markets during July. Brent prices dropped to nearly USD 69 per barrel early in the month but subsequently climbed to about USD 105 per barrel on July 23 amid renewed tanker attacks and declining shipments through the Strait of Hormuz.

The EIA also expects rising US oil output to contribute to improved global supply conditions. American crude production is forecast to increase from approximately 13.8 million barrels per day in 2026 to 14.2 million barrels per day in 2027.

US commercial crude inventories, however, are expected to remain below their five-year average range through the end of 2026, indicating continued pressure on domestic stock levels.

Meanwhile, the outlook for US natural gas remains comparatively soft. Henry Hub prices are forecast to average USD 2.87 per million British thermal units in the third quarter of 2026, around 50 cents lower than the previous estimate. Strong domestic production and weaker demand for natural gas used as LNG feedgas are expected to contribute to higher inventories.

US LNG exports are projected to rise from 17 billion cubic feet per day in 2026 to 19 billion cubic feet per day in 2027.

The EIA also sees continued expansion in renewable electricity generation. During the first half of 2026, solar generation increased 21 per cent, hydropower output rose 9 per cent and wind generation grew 6 per cent. Lower natural gas prices are expected to encourage greater gas-fired power generation while contributing to a further decline in coal-based electricity production.