Forecast Update - July 2025
Update of Brent and WTI forecasts.
Dear subscribers,
At the beginning of each month, we will be sending you an email like this with an updated forecast of energy prices. Commodia brings together top academic economists who specialize in the analysis of global energy markets. The team has more than 20 years of experience from leading universities across the United States, Canada, Europe, and the Asia Pacific. Our forecasts are based on state-of-the-art forecasting techniques to predict energy commodity prices.
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🛢️Oil Market - June 2025 Summary
In June 2025, global oil prices experienced significant volatility due to geopolitical tensions and supply-demand dynamics. Early in the month, prices surged following Israeli airstrikes on Iranian nuclear facilities, with Brent reaching approximately $74.23 and WTI climbing to $77.62. However, as tensions eased and the risk premium diminished, prices retreated by month's end.
Concurrently, OPEC+ announced a production increase of 411,000 barrels per day for July, contributing to a well-supplied market. Despite strong demand growth in Asia, particularly from China and India, the global oil market remained under pressure due to ample supply and subdued demand from European refineries.
🟧 Commodia - Forecast Update of Brent
📈 Comparison of Commodia Forecast vs. ICE Future Price
In July 2025, Commodia forecasts Brent crude oil at $74.66 per barrel, which is 8.1% higher than ICE’s forward priceof $69.05. By October 2025, the gap widens further, with Commodia projecting $74.80—12.8% higher than ICE’s $66.33.
In January 2026, Commodia forecasts $76.78 per barrel, which is 18.3% higher than ICE’s forward price of $64.91. By July 2026, Commodia anticipates $78.60, 21.4% higher than ICE’s $64.75. Looking ahead to July 2027, Commodiaprojects $83.85 per barrel, which is 27.5% higher than ICE’s $65.76.
🟥 Commodia - Forecast Update of WTI
📈 Comparison of Commodia Forecast vs. NYMEX Future Price
In July 2025, Commodia forecasts WTI crude oil at $70.65 per barrel, which is 7.6% higher than NYMEX’s forward price of $65.65. By October 2025, the gap increases slightly, with Commodia projecting $70.45, which is 9.4% higherthan NYMEX’s $64.40.
In January 2026, Commodia forecasts $72.59 per barrel, 15.8% higher than NYMEX’s $62.68. By July 2026, Commodia expects $75.22, which is 21.0% higher than NYMEX’s $62.18. Looking ahead to July 2027, Commodiaprojects $80.49, a substantial 29.5% premium over NYMEX’s forward price of $62.15.
🗝 Key drivers of Commodia’s crude oil forecast from the previous month
The main variables influencing Commodia's crude oil forecast (Brent and WTI) are global fuel consumption, global economic conditions, and OECD petroleum inventories. The main change in our forecast from June is an improvement in Global Economic Conditions, which has put upward pressure on our oil price forecasts (13.37% increase in WTI and 10.58% in Brent).
The main determinants of Global Economic Conditions are shown in the figure below:
Chart of Main Drivers of Global Economic Conditions from Christiane Baumeister & Dimitris Korobilis & Thomas K. Lee, 2022. "Energy Markets and Global Economic Conditions" The Review of Economics and Statistics, 104(4), 828-844.
The main determinants of Global Economic Conditions are shown in the figure above for the period January 2022 to June 2025.
For more details about the Global Economic Conditions index visit: https://sites.google.com/site/cjsbaumeister/research
References
International Energy Agency (IEA). (2024). Oil Market Report - May 2024.
U.S. Energy Information Administration (EIA). (2024). Short-Term Energy Outlook - May 2024.
BNN Bloomberg. (2024). Oil Markets Look ‘Reasonably Well Supplied’ in 2024.
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Commodia Team