Summary
The price of a barrel of the crude oil benchmark grade West Texas Intermediate has fluctuated between $65 and $80 over the past year and is currently near the midpoint of that range. Oil prices are down sharply from the $$115-120 level, touched back in 1H22 when Russia invaded Ukraine. For 2025, we are anticipating an average price of $75, up slightly from current levels but lower compared to $77 in 2024, $80 in 2023 and $95 in 2022. Our forecast trading range for the year is $65-$85. The core drivers behind oil prices over the long term come from Econ 101: global supply and demand. According to the U.S. Energy Information Administration, there will be an excess supply of oil in 2025: global consumption is estimated at 104.1 million barrels per day, while global production is estimated at 104.4 million barrels. Early forecasts for 2026 also call for supply to exceed demand, which likely will provide a ceiling for oil prices. Of course, there are always wild cards such as geopolitical developments, ranging from tariffs, to wars, to sanctions, to the ongoing turmoil in the Middle East. The growth path of the Chinese economy also plays an outs
