JPMorgan warned of a possible oil price drop to $30 in 2027

The world is threatened by a glut of oil, which could collapse Brent quotations to the level of $ 30 per barrel by the end of 2027. This analysts JPMorgan warned clients in a note dated November 24, writes CNBC. To prevent this from happening, it is necessary to take measures to limit supplies, notes the investment bank.

In 2026, the market may face a surplus of 2.8 million barrels of oil per day, and in 2027 - with a surplus of 2.7 million barrels. Such volumes of excess supply can lower the cost of Brent oil to $42 per barrel in 2027, and by the end of the year - and even to the level of $30, if production is not reduced, analysts warned.

Nevertheless, "the scale of the anticipated imbalances is unlikely to be fully realized," says Natasha Kaneva, head of global commodity markets strategy at JPMorgan. The bank's analysts maintain their forecast for the Brent price at $58 a barrel in 2026 and $57 in 2027 on the assumption that producers will voluntarily cut production to stabilize the market. Without such intervention, low prices alone will stimulate demand and force non-OPEC producers to cut production, which could also restore balance, Kaneva notes. However, to stabilize prices even at these levels, according to JPMorgan analysts, "will require significant efforts".

Despite the prevailing pessimism, the demand for oil in 2025 was stable, increasing by 900 thousand barrels per day, notes JPMorgan. In 2027, the bank estimates that demand growth could accelerate to 1.2 million bpd. However, supply is expected to grow three times faster - both this year and next year. And half of the increase will fall on oil exporters outside the OPEC+ alliance, JPMorgan analysts note.

Since the beginning of the year, Brent crude oil has already fallen in price by 16% and US WTI by 19%. OPEC+ continues to increase production after years of restrictions. On Monday, Brent traded above $62 per barrel, while West Texas Intermediate traded just above $58.

This article was AI-translated and verified by a human editor