JP Morgan: Without production cuts, oil prices may fall to $30!

On Monday, analysts at JPMorgan Chase predicted in a report that the average price of Brent crude oil would be between $57 and $58 per barrel in 2026 and 2027, and that oil prices could fall to around $30 per barrel unless production cuts are implemented. They estimate that starting in June 2026, the global oil market will need to decrease production by approximately 2 million barrels per day. The bank forecasts that global oil supply will exceed demand. In 2025 and 2026, the rate of growth in oil supply will be three times that of demand, and by 2027, the growth rate will slow to about one-third of the current rate. JPMorgan Chase wrote, "We expect the market to balance through a combination of rising demand (driven by falling prices) and voluntary and involuntary production cuts. Without any intervention... the outlook for 2027 will become bleaker, as continued oversupply will push the average price of Brent crude to $42, falling to over $30 by the end of the year." JPMorgan Chase predicts that the average price of WTI crude oil will be in the range of $53 to $54 per barrel in 2026 and 2027. In a report, the bank stated that global oil daily demand is expected to increase by 900,000 barrels in 2025, reaching 105.5 million barrels; there will be a similar increase in 2026, followed by a faster growth to 1.2 million barrels in 2027. On Monday, after four consecutive days of decline, crude oil futures prices rose, benefiting from the stock market rebound. Expectations of a rate cut in December by the US strengthened, while doubts about whether Russia can reach a peaceful agreement with Ukraine (which could boost Russian oil exports) also increased. Jorge Montepeque, Managing Director of Onyx Capital, stated that new sanctions imposed by the US on Russian oil companies Rosneft and Lukoil triggered chain reactions that could have pushed oil prices higher, but the market is currently focused on peace negotiations. The near-month contracts for both benchmark oil prices (January contracts) rose 1.3% on Monday, with WTI crude oil closing at $58.84 per barrel and Brent crude closing at $63.37 per barrel. US natural gas futures closed lower but above earlier lows, as weather forecasts continue to show colder weather later this week and into December; NYMEX December natural gas futures fell 0.7%, settling at $4.549 per million British thermal units.