Volatility is expected to continue across energy markets, according to the Energy Information Administration’s April short-term outlook.
EIA underlined uncertainties in energy supply, demand and prices resulting from tariff announcements last week. Additionally, OPEC+ announced some countries will increase oil production in May rather than July, as previously announced.
The Brent crude oil spot price dropped to $68 per barrel as a result.
“The agency expects continued volatility as market participants respond to further developments,” EIA said.
We completed our forecasts on April 7.
This #STEO includes some of the recent changes in the energy market, but we expect volatility could continue as market participants respond to further developments.
Full report: https://t.co/omAfuxyJUU pic.twitter.com/J6ccvzK5XO
— EIA (@EIAgov) April 10, 2025
Continued growth in U.S. and global oil production, while demand decreases, will lower Brent crude oil prices from an average of $70 per barrel in 2025 to $60 per barrel in 2026. This 10% drop from EIA’s March outlook reflects global uncertainty as well as the potential for additional supply from OPEC+.
EIA expects China’s retaliatory tariffs on U.S. goods will have the largest effect on propane, with China being a major importer of U.S. propane. This could lead to downward pressure on the Mt. Belvieu propane spot price.
Diesel prices are forecast to be up-and-down and to average $3.45 per gallon nationally by the end of 2025. EIA expects that trend to continue in 2026 and forecasts an average around $3.50 per gallon by mid-year.
The U.S. macroeconomic outlook used in EIA’s short-term outlook is based on S&P Global’s macroeconomic model. S&P Global’s forecast assumes an increasing universal tariff that will reach 10% by the end of 2025, as well as a higher rate on U.S. imports from China.
| U.S. energy market indicators | 2024 | 2025 | 2026 |
| Brent crude oil spot price (dollars per barrel) | $81 | $68 | $61 |
| U.S. crude oil production (million barrels per day) | 13.2 | 13.5 | 13.6 |
| Natural gas price at Henry Hub (dollars per million British thermal units) | $2.20 | $4.30 | $4.60 |
| U.S. liquefied natural gas gross exports (billion cubic feet per day) | 12 | 15 | 16 |
| Shares of U.S. electricity generation | |||
| Natural gas | 42% | 40% | 40% |
| Coal | 16% | 16% | 15% |
| Renewables | 23% | 25% | 27% |
| Nuclear | 19% | 19% | 19% |
Data source: U.S. Energy Information Administration, Short-Term Energy Outlook, April 2025
The full EIA short-term outlook is available here. LL
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