Crude oil markets face potential structural imbalance as supply growth accelerates at three times the rate of demand expansion in 2025 and 2026. Investment bank analysts project this fundamental mismatch will drive Brent crude prices below $60 per barrel in 2026, potentially reaching the low $30s by end-2027, representing a decline of over 50% from current levels around $63.50.

Non-OPEC+ production capacity, led by North American output increases, forms the primary driver of anticipated supply surplus. Market projections indicate daily surplus volumes reaching 2.8 million barrels in 2026, maintaining elevated levels through 2027. This supply dynamic contrasts with demand patterns that continue exceeding bearish forecasts, yet remain insufficient to absorb accelerating production growth.

Energy market rebalancing will likely require supply-side adjustments rather than demand destruction, given the magnitude of projected surpluses. Current US energy policy supporting expanded domestic drilling reinforces the supply-heavy outlook, potentially intensifying price pressure on crude producers. Traders monitoring this scenario anticipate significant volatility in energy equity markets and potential shifts in global production strategies as traditional price support mechanisms face unprecedented supply challenges.