Oil prices fell over 10% in 2025, with Brent crude on track to record the longest consecutive annual losses ever, amid an oversupplied market affected by wars, rising tariffs, increased OPEC+ production, and sanctions on Russia, Iran, and Venezuela.
اضافة اعلان
Brent crude futures dropped nearly 18%, marking the largest annual decline since 2018 and heading for a third consecutive year of losses. The March contract, expiring Wednesday, fell six cents to $61.27 per barrel by 01:47 GMT.
U.S. West Texas Intermediate (WTI) crude fell five cents to $57.90 per barrel, heading for a 15% annual decline.
Oil markets started 2025 strongly when former U.S. President Joe Biden imposed harsher sanctions on Russia, disrupting supplies to China and India, the largest buyers.
The war in Ukraine intensified after drones launched by Kyiv damaged Russian energy infrastructure and disrupted Kazakhstan’s oil exports. The 12-day conflict between Iran and Israel in June threatened shipping through the Strait of Hormuz, pushing prices higher.
Geopolitical tensions also escalated due to a dispute between Saudi Arabia and the UAE—key OPEC producers—over Yemen, and former U.S. President Donald Trump imposed a blockade on Venezuelan oil exports while threatening further action against Iran.
However, prices declined as the OPEC+ alliance, comprising OPEC and its allies, accelerated production increases this year, combined with growing concerns over the impact of U.S. tariffs on global economic growth and fuel demand.
OPEC+ Outlook
The alliance decided to suspend oil production increases in the first quarter of 2026 after injecting about 2.9 million barrels per day into the market since April. The next OPEC+ meeting is scheduled for January 4.
Most analysts expect supply to exceed demand next year, by 3.84 million barrels per day according to the International Energy Agency and by 2 million barrels per day according to Goldman Sachs.
Martijn Rats, analyst at Morgan Stanley, said: “If the price drops significantly, I expect some production cuts from OPEC+… but prices may need to fall further—perhaps toward $50. If current prices hold after the suspension of increases in Q1, the alliance is likely to continue offsetting these cuts.”
Reuters
