Customary Chartered Bucks Bearish Development, Forecasts Oil Value Positive factors in 2026

We’re within the remaining innings of the third quarter, and power markets stay tepid amid bearish sentiment. Brent crude for November supply was buying and selling at $69.45 per barrel at 8.45 am ET on Friday, greater than $10/bbl under the present yr’s peak at ~81/bbl, whereas WTI crude was altering arms at $65.05 per barrel in comparison with the January peak of $78.71 per barrel. Oil costs have principally traded ~15/bbl decrease in 2025 in comparison with the earlier yr, primarily as a consequence of oversupply fears as a consequence of OPEC+ accelerating the unwinding of manufacturing cuts, coupled with sluggish world financial progress and heightened commerce tensions that suppressed oil demand, resulting in ample world provide outweighing demand. Elevated output from non-OPEC+ international locations additionally contributed to a build-up of oil inventories. These days, Wall Road has been warning that oil markets might quickly face a surplus, placing extra stress on already depressed oil costs. To wit, Goldman Sachs has predicted that oil markets could possibly be oversupplied by 1.9 million b/d in 2026 amid OPEC+ unwinding manufacturing cuts and manufacturing within the Americas rising. Wall Road now sees oil costs sinking to the $50s per barrel subsequent yr, additional compounding this yr’s decline.

In sharp distinction, commodity analysts at Customary Chartered have predicted that oil costs will transfer increased within the coming yr pushed by strong demand and a raft of financial stimulus measures.

StanChart notes that U.S. provide has hit an all-time excessive within the present yr, however is predicting that producers can be pressured to chop output as a consequence of prevailing low oil costs. On the demand facet, expectations of weaker world demand within the remaining quarter of the yr, pushed by commerce wars and tariffs, are more likely to set off a raft of financial stimulus within the type of charge cuts in america and potential for China to reply with a package deal of measures. Additional, Ukraine’s focused assaults on Russian power infrastructure have pressured Russia to chop refinery runs and ramp up crude exports. In response to StanChart, vessel-tracking information means that Russia’s seaborne crude exports jumped to a 16-month excessive at 3.62 million barrels per day (mb/d) in August. The analysts be aware that Ukrainian assaults have additionally targeted on each pipeline pumping stations and export terminals, which might stress crude loadings additional in the event that they grow to be important sufficient to halt flows for prolonged intervals. In the meantime, an escalation within the unfolding tensions between Europe and Russia is more likely to improve the chance premium for crude oil and pure fuel.