On Tuesday, December 9th, the US Energy Information Administration (EIA) stated in its monthly Short-Term Energy Outlook (STEO) report that US oil production this year is expected to reach a record high, exceeding previous forecasts, amid rising expectations of a global supply glut.

The EIA raised its 2025 US oil production forecast by 20,000 barrels per day (bpd), now expecting a year-on-year increase of 380,000 bpd to reach an average of 13.61 million bpd, a record high.

The EIA lowered its 2026 US oil production forecast by 50,000 bpd, now expecting a year-on-year decrease of 80,000 bpd to reach 13.53 million bpd.

The EIA stated that US Permian Basin oil production is expected to increase by 260,000 bpd in 2025 to reach a record high of 6.54 million bpd.

U.S. oil production averaged 13.85 million barrels per day in December, down from 13.86 million barrels per day in November. U.S. oil production is projected to average 13.71 million barrels per day in January 2026.

The EIA raised its U.S. production forecast for this year, reinforcing expectations of a supply glut in the oil market. This follows the International Energy Agency's (IEA) statement last month that the global oil market could see a larger surplus of up to 4.09 million barrels per day next year.

The EIA raised its 2025 U.S. oil demand forecast by 100,000 barrels per day to 20.6 million barrels per day. The 2026 demand forecast remains flat year-on-year at 20.6 million barrels per day.

The EIA stated that average U.S. consumption of oil and other liquid fuels will reach 20.6 million barrels per day in 2025, higher than the 20.5 million barrels per day forecast in November.

U.S. gasoline consumption is projected to average 8.9 million barrels per day in 2025, higher than the 8.89 million barrels per day forecast in November.

U.S. distillate fuel oil consumption is projected to average 3.86 million barrels per day in 2025, lower than the 3.87 million barrels per day forecast in November.

Regarding prices, the EIA projects the average price of West Texas Intermediate (WTI) crude oil in 2025 to be $65.32 per barrel, higher than the $65.15 per barrel forecast in November.

The average price of WTI crude oil in 2026 is projected to be $51.42 per barrel, higher than the $51.26 per barrel forecast in November.

The average price of Brent crude oil in 2025 is projected to be $68.91 per barrel, higher than the $68.76 per barrel forecast in November.

The average price of Brent crude oil in 2026 is projected to be $55.08 per barrel, higher than the $54.92 per barrel forecast in November.

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