JP Morgan forecasts that the international oil prices may drop into the $30s per barrel by 2027 because of an overwhelming market oversupply.
Goldman Sachs has also forecasted that WTI Crude, the U.S. benchmark, is going to average $53 per barrel in 2026 amid a surplus of 2 million bpd and has advised its investors to short oil right away.
The fact is that the oil market is anticipated to rebalance in 2027 post the present large supply wave, which includes the output from OPEC+ as well as non-OPEC producers based in the Americas, works through the system.
Brent, the international crude benchmark, says that the oil prices may drop into the $30s per barrel handle by 2027 since the oversupply could flood the market, as per a forecast done by JP Morgan.
The Brent crude prices have dipped by 14% year to date and traded relatively balanced at $62.59 per barrel early on November 24, 2025, as the oil market looks forward to news from a certain renewed set of negotiations on peace in Ukraine.
The U.S. as well as Ukraine held talks on November 23 in Geneva. Both sides described it as highly productive talks and also agreed to continue to go ahead with the intensive work on a refined peace plan, which was first proposed by the U.S. in the week before.
In spite of the fears of a surplus, analysts as well as the investment banks do not see oil prices dipping to $40 or below, even though oil is set to decline when it comes to the near term with robust supply coming from OPEC+ as well as other non-OPEC producers in the Americas.
Peace in Ukraine could as well weigh on energy prices since some sanctions as well as restrictions on Russia could get eased, say analysts.
It is well to be noted that the oil prices are set to drop further into 2026 from the present levels due to a massive amount of surplus on the market, with WTI Crude, the U.S. benchmark, forecasted to average almost $53 per barrel in 2026, opines Goldman Sachs.
The call by the investment bank for 2026 is that oil prices are indeed on track for more declines, and investors should go ahead and short oil right away, said the co-head of global commodities research with Goldman Sachs, Daan Struyven, to CNBC.
The surplus in 2026 is going to be 2 million bpd on average, reckons Goldman, who also notes that 2026 is going to be the last year of the present big supply wave that is hitting the market.
Notably, the oil market is all set to rebalance in 2027 since 2026 is going to witness the final big oil supply wave, which the market has to work through, added Struyven from Goldman Sachs.
