Crude oil prices are likely to fall to the $55-60 per barrel range by December 2025. Expected increase in supplies and weak global demand are predicted to drive this outcome. Traders are currently buying crude at around $70 per barrel. Analysts predict that subdued global demand will drive prices down.
Premasish Das, while talking about S&P’s commodity market insights forum on 3rd July mentioned -“we think by the end of year 2025 the oil price can go below $60 per barrel levels because of so much supply and muted demand. The underline assumption is that OPEC + is not going to do anything, which means that they are not going cut production or defend any price.”
Prices have shifted downward from the highs seen in recent years.
Here is the detailed information regarding the expected fall: –
- Slowing economic growth in countries like China, Europe, and the US is weakening global demand, which in turn is hitting oil demand.
- Rise of green energy shift- day by day many countries are moving towards electric vehicles and renewable, this is reducing fossil fuel consumption.
- OPEC+ strategy- if OPEC + refuse Further cut or increase production then oversupply could drive prices down especially Saudi Arabia and Russia.
- Geopolitical stabilization- Ease in tensions in between oil producing regions can lead to reduce risk premium on prices.
- US Shale Boom- the US continue to Ramp up oil production adding to global supply.
Do you know the impact of this?
Lower crude prices can slash India’s import bills, stabilize the rupee, and curb inflation, resulting in cheaper fuel and transport. Meanwhile, oil-exporting Gulf nations and Russia may face revenue pressure. In the markets, this scenario could hurt energy stocks but boost consumer sectors due to lower inflation.