Oil Output to Rebound Fully by Year-End Amid Hormuz Disruptions
The US Energy Information Administration (EIA) forecasts that global oil output will return to pre-Iran war levels by the end of this year. The disruption caused by the Iran war led to a blockade of the Strait of Hormuz, forcing refiners in Europe and Asia to reduce fuel output.
The EIA expects Brent crude oil prices to average around $74 per barrel in the third quarter of this year, down from an average of $85 in June. This is lower than their previous forecast of over $101 a barrel in the third quarter.
The agency has also raised its annual oil production expectations while lowering its oil and motor fuel price forecasts. The EIA expects most of the oil output previously shut in across the Middle East to return online by the first quarter of 2027, lifting global supply and reducing withdrawals from stockpiles.