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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 - July 2025 Summary
In August 2025, the oil market remained volatile, with prices reflecting a tug-of-war between strong supplies and persistent geopolitical concerns. Brent crude hovered near $67–68 per barrel, while WTI stayed around $63 per barrel, both impacted by a renewed U.S. tariff on Indian oil imports and elevated uncertainty amid the Ukraine war.
A significant factor contributing to price pressure was an unexpected 2.4-million-barrel weekly draw in U.S. crude inventories, signaling tightening domestic supply amid rising fuel demand. At the same time, OPEC+ ramped up production, adding 548,000 barrels per day in August, a pronounced escalation from previous months that fueled oversupply concerns globally
🟧 Commodia - Forecast Update of Brent
📈 Comparison of Commodia Forecast vs. ICE Future Price
In September 2025, the forecasts from Commodia and ICE are nearly identical, with Commodia projecting Brent crude at $67.14, just 0.13% above ICE’s $67.05. By December 2025, however, Commodia forecasts a slightly lower price than ICE, with a 0.63% gap.
From March 2026 onwards, Commodia becomes notably more bullish than ICE. The difference widens to 4.5% in March 2026, further expanding to nearly 8% by September 2026, and peaking at an 18.2% divergence in September 2027, when Commodia forecasts $77.95 per barrel versus ICE’s $65.99.
🟥 Commodia - Forecast Update of WTI
📈 Comparison of Commodia Forecast vs. NYMEX Future Price
In September 2025, Commodia forecasts WTI at $64.14, just 0.2% above NYMEX’s estimate of $64.01, indicating close alignment between the two benchmarks. However, by December 2025, a notable divergence emerges, with Commodia projecting $66.08, while NYMEX forecasts a lower $62.70, a gap of 5.4%.
The spread continues to widen in March 2026, when Commodia expects $69.06 per barrel—10.8% higher than NYMEX’s $62.33. This divergence persists through the medium term: by September 2026, Commodia projects $71.04, compared to NYMEX’s $62.04—a gap of 14.5%. The difference peaks in September 2027, when Commodia expects $76.58, while NYMEX remains at $62.13, representing a 23.3% divergence.
🗝 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 August is a small increase in OECD petroleum inventories, which has put downward pressure on our oil price forecasts.
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 August 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