The Energy Information Administration’s April short-term energy outlook centered largely on fuel and related markets due to the closure of the Strait of Hormuz.
EIA estimates that 7.5 million barrels of crude oil were collectively shut in daily by Iraq, Saudi Arabia, Kuwait, the UAE, Qatar and Bahrain in March.
In its short-term outlook, EIA said it does not expect the U.S.-Iran conflict to extend beyond April. If that is the case, production shut-ins will increase to more than 9 million barrels per day in April.
“Our petroleum forecasts are highly contingent on the interaction of three variables,” EIA Administrator Tristan Abbey said. “First, to even run our model, we have to make an assumption about the duration of the Strait of Hormuz closure. Second, we know that the closure is forcing production to shut in, but we can only estimate these outages. Third, just as we had never before seen the strait close, we’ve never seen it reopen. What exactly that looks like remains to be seen.
Diesel prices are expected to remain elevated due to tighter global supplies and U.S. inventories below the five-year average.
EIA forecasts diesel to peak at more than $5.80 per gallon in April and average $4.80 per gallon in 2026.
“Full restoration of flows will take months,” Abbey said. “Our modeling indicates that fuel prices will continue to rise until these variables resolve.”
Brent crude oil averaged $103 per barrel in March. EIA forecasts the average price to increase to $115 per barrel in the second quarter of 2026, then fall to $90 per barrel by the fourth quarter of this year and to $76 per barrel in 2027.
“We maintain a risk premium on crude oil prices throughout the forecast period as we expect uncertainty around future supply disruptions to keep prices above pre-conflict levels,” EIA said.
| Notable Forecast Changes | 2026 | 2027 |
| Brent crude oil spot price (dollars per barrel) | $96 | $76 |
| Previous forecast | $79 | $64 |
| Percentage change | 22% | 18% |
| Global oil inventory change (million barrels per day) | -0.3 | 3.3 |
| Previous forecast | 1.9 | 3.0 |
| Change | -2.2 | 0.3 |
| OPEC+ crude oil production (million barrels per day) | 41.7 | 45.0 |
| Previous forecast | 43.9 | 45.0 |
| Percentage change | -5.0% | -0.1% |
| Retail diesel price (dollars per gallon) | $4.80 | $4.11 |
| Previous forecast | $4.12 | $3.78 |
| Percentage change | 16.7% | 8.6% |
The current STEO forecast was released April 7.
The previous STEO forecast was released March 10.
The full short-term outlook is available online.
EIA also recently released its annual energy outlook for 2026, which is “best understood as a product suite for future analysis, not a set of predictions,” Abbey said. LL
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