en.Wedoany.com Reported - The U.S. Energy Information Administration (EIA) forecasts that global oil production and trade flows will fully recover from disruptions caused by the Iran war by the end of this year.
In the third quarter of this year, the average spot price of global benchmark Brent crude oil was about $74 per barrel, down from an average of $85 in June. The agency had previously forecast an average Brent price of over $101 per barrel for the third quarter.
The months-long blockade of the Strait of Hormuz during the war has halted millions of barrels of daily oil production in the Middle East, forcing refineries from Europe to Asia to reduce fuel output. Following a preliminary agreement between the United States and Iran, the number of vessels transiting the waterway has increased in recent days. Although passage through the Strait of Hormuz is not yet fully safe, the EIA has raised its annual oil production forecast while lowering its projections for oil and motor fuel prices.
The EIA expects that most of the previously halted oil production in the Middle East will come back online by the first quarter of 2027. The agency stated that this will increase global supply, reduce inventory withdrawals, and return the oil market to a state of oversupply, thereby putting downward pressure on prices.
In its July Short-Term Energy Outlook report, the EIA stated that it expects continued oil inventory accumulation over the next year to keep downward pressure on crude oil prices. The agency now forecasts an average oil price of about $65 per barrel next year, down from its previous forecast of over $79 per barrel for 2027.
The EIA said that falling crude oil prices will lead to lower U.S. retail gasoline prices. The agency now expects the average price of U.S. motor fuel in the third quarter to be about $3.80 per gallon, down from $4.21 per gallon in the second quarter. The ripple effects of the Iran war had pushed U.S. motor fuel prices to multi-year highs, creating significant political concerns for President Donald Trump and his Republican Party ahead of the November midterm elections.
