The Zhitong Finance App learned that the US has raised the price forecast for diesel and gasoline next year, which shows that even if oil supply in the Middle East rebounds, the price pressure faced by consumers can only be mitigated to a limited extent. The US Energy Information Administration (EIA) raised the average gasoline retail price forecast for 2027 to $3.73 per gallon, higher than the October forecast of $3.56 per gallon, on the grounds that global fuel supply is expected to continue to be tight. The agency also raised its diesel price forecast for next year to $5.03 per gallon, higher than the previous forecast of $4.49 per gallon.
Energy prices have soared as a result of the US-Iran conflict, and continued attacks on Russian refineries by Ukrainian drones have further exacerbated this situation. High gasoline and diesel prices are one of the core factors that have sparked Americans' dissatisfaction with President Trump's Republican Party. To a certain extent, this led to the Democratic Party's historic victory in the midterm elections last week.
Admittedly, retail fuel prices are falling. Gasoline prices in the US fell below $4 per gallon on Monday for the first time since July, according to data from the American Automobile Association (AAA). Gasoline prices usually drop in the beginning of winter. However, the current forecast price is much higher than the 2025 level, indicating that it may take time for the energy market to return to normal.
Oil traders are also watching closely for any signs of demand disruption, including short-term and structural changes. The EIA estimates that global liquid fuel consumption will decrease by 2 million b/d in 2026 due to reduced demand in China and reduced economic activity and air travel in the Middle East.
In October, the Iran-backed Houthis attacked Riyadh's main airport, causing the transportation hub to close for two weeks, and the airline cancelled flights until December. However, according to the EIA, this portion of lost demand is expected to fully recover in 2027.
Meanwhile, the average price of Brent crude oil is expected to be 104 US dollars per barrel in November, 99 US dollars per barrel in December, and 86 US dollars per barrel in 2027. The current trading price of Brent crude oil is close to 92 US dollars per barrel. It fell sharply a week after the election, as traders increased their bets on the resolution of the Iranian conflict.
However, there are still some factors that may provide bottom support for oil prices. The EIA expects global oil inventories to increase in the last few months of 2026 and continue to rise until 2027. The agency also raised expectations for US gas stocks at the end of November due to high temperatures in early November.