Brent Steady After OPEC+ Modest Output Hike. Forecast as of 08.10.2025 | LiteFinance
Generally, the surplus in the oil market presents an opportunity to earn by accumulating reserves and selling them at higher prices. However, in 2025 and 2026, it will be challenging to benefit from this opportunity. Let’s discuss this topic and make a trading plan for Brent.
The article covers the following subjects:
Major Takeaways
- The International Energy Agency (IEA) forecasts a surplus of 3.3 million bpd in 2026.
- The EIA expects record production in the US of 13.53 million bpd.
- OPEC+ will increase production by 137,000 bpd.
- Brent sales are relevant at $67.
Weekly Fundamental Forecast for Brent
When the oil market experiences a significant surplus, contango strategies return. In the spot market, crude prices fall below forward prices. As a result, traders purchase cheap oil, store it, and then sell it at a higher price, generating profits. This trend was evident during the price war between Saudi Arabia and Russia, the global pandemic in 2020, and between 2014 and 2017, when Riyadh faced another competitor: American shale. In addition, contango was observed during and following the global economic crisis of 2008–2010.
Brent Spot and Contango Markets
Source: Bloomberg.
However, interest rates have increased significantly since that time. The current economic climate has led to a decline in the profitability of oil storage, which has had a negative impact on Brent. Stockpiling is becoming cost-prohibitive, so oil sales are more straightforward today. Bears have dragged Brent prices down by 11% since the beginning of the year, and the bottom is not even in sight.
The International Energy Agency anticipates an oil surplus of 3.3 million bpd in 2026. Macquarie Group estimates a surplus of 4.63 million bpd in Q1 2026, after which it will gradually decline. The company suggests that Brent will decline to $57 per barrel in January–March and then rise slightly to $59 in April–June.
The IEA forecasts US production will reach a record 13.53 million bpd in 2025, higher than the previous estimate of 13.44 million bpd and the 2024 figure of 13.23 million bpd. In 2026, oil production is expected to decline slightly by 0.1% to 13.51 million bpd. The EIA had previously anticipated a 1% decrease. When considering the increase in OPEC+ production, its growth outside the coalition, and the slowdown in global demand, the outlook for Brent becomes unfavorable for bears.
In light of the current state of the oil market, OPEC+ has decided to increase production by a modest 137,000 bpd in November. The alliance is proceeding with caution, which has led to a partial closure of short positions on Brent and a subsequent rebound in quotes. This means that before selling, investors should observe an increase in oil reserves.
Global Crude in Transit at Sea
Source: Bloomberg.
According to Vortexa, the total amount of oil in transit has increased to 1.2 million bpd, marking the highest figure since 2016. If we exclude vessels that are not moving, the figure will be the highest since the start of the pandemic. The impact of the pandemic on demand has been significant, prompting traders to explore diverse storage solutions, ranging from large supertankers to more compact barges. What more evidence of stockpiling is needed?
Weekly Trading Plan for Brent
The oil market is clearly bearish. In such conditions, Brent can be sold on the rise towards $67 per barrel. At the same time, if Brent quotes plunge below $65, short positions can be considered.
This forecast is based on the analysis of fundamental factors, including official statements from financial institutions and regulators, various geopolitical and economic developments, and statistical data. Historical market data are also considered.
Price chart of UKBRENT in real time mode
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