Crude oil prices are likely to average around $60-70 per barrel in 2025 with a potential to fall below $60 by the end of the year on increasing supply by the Organisation of Petroleum Exporting Countries and weakening global demand, analysts say.
Benchmark Brent prices hovered around $66 per barrel on Monday. Prices however rose after the Organisation of Petroleum Exporting Countries, led by Saudi Arabia, decided to increase output starting October, at a slower pace than earlier.
OPEC Output and Price Outlook
“Prices are expected to soften and remain in the range of $60–$64 per barrel in the near term, potentially coming down to $55-$60 per barrel by early 2026 if supply continues to rise,” said Sourav Mitra, Partner, Grant Thornton Bharat. “This trend is driven by increased global inventories, moderated demand, and macroeconomic stability,” he added.
The eight members of the cartel decided to raise production by 137,000 barrels per day from October, notably smaller than the earlier monthly hikes of about 555,000 bpd for September and August and 411,000 bpd in July and June.
The decision comes as Saudi Arabia looks to regain its market share even at a time when crude prices have already been trading below $70/ barrel, as per analysts.
“Crude prices are likely to average $60 to $70 per barrel this year. But the increased production by OPEC could have a dampening effect,” said Prashant Vasisht, Senior Vice President and Co-Group Head, Icra, adding that at the end of the year, crude prices may come down below $60/bbl.
Manas Majumdar, Partner and Leader Oil and Gas at PwC India also noted that the broad trajectory for crude oil prices is downwards especially with increased supply.
“We are around $65/bbl of Brent and while it had moved up a bit due to the Ukraine war & tariffs uncertainty etc. but the trend is it will go below $60 by next year,” Majumdar said.
Lower prices are likely to benefit downstream sectors such as refining and petrochemicals through improved margins and reduced input costs. Governments may also gain from lower import bills and subsidy burdens. However, upstream companies could face margin pressure and reduced capital spending, prompting a shift toward cost efficiency, pointed out Mitra.
“From July 2022 to December 2024 upstream companies had to pay windfall taxes which limited their realization to somewhere between $70 to $75/bbl in any case. So from there to $65/bbl or whatever level crude prices be, that would be the impact. It will be a hit, certainly,” Vasisht said.
Vedika Narvekar, Research Analyst – Commodities & Currencies, Anand Rathi Shares and Stock Brokers expects crude oil prices to trade at $55 on the lower side and $67.50 on the higher side during Q4 2025 unless any major geopolitical escalation occurs.
Impact on Industry and Demand Trends
Experts believe that OPEC production pressure will start building up in the last quarter.
“A temporary dip below $55-$65 cannot be ignored, but the same may not sustain as US drilling activity may decline substantially and US production may slide towards 13 mbpd by End-2026,” Narvekar said.
The increased supply forms a part of 1.65 million barrels per day (~ 2% of world demand), an additional layer of production which was originally scheduled to be kept back until the end of 2026. Additionally, OPEC+ stated that, contingent to market conditions, it will reimburse all or a portion of 1.65 mbd of additional supply.
“The increase in supply has been baked into Brent oil prices during the week of September 1st to 5th, wherein Brent price plummeted by 3% to $65.5/bbl. Moreover, the increase in actual supply will move the needle farther than the quantum mentioned in their announcement, noted Dhaval Popat, Analyst, Energy, Choice Institutional Equities.
However, analysts say that prices would bounce back soon from $50 level as oil may approach average break even cost at many producing regions and lower prices may discourage production.
“A widely expected supply glut is forecast to appear in the fourth quarter onward. The challenge for the bears is that this has already been well flagged. If most of the inventory build stays in China and not in key pricing hubs, the impact may not be as severe. But overall we expect oil prices to remain under pressure in the coming quarters,” said Narvekar.
Choice Institutional Equities has also maintained its estimate for Brent of $69/bbl for calendar year 2026 as compared to YTD average of $69.9/bbl.