Fitch Ratings Adjusts Oil Price Expectations for 2025

Fitch Ratings has revised its 2025 oil price assumptions downward, pointing to weaker global growth due to trade tensions and an anticipated increase in OPEC+ production. The agency now forecasts Brent crude to average $65 per barrel, a decrease from $70, and WTI crude to average $60, down from $65.

Oversupply and Production Increases Loom

The adjustment reflects concerns over a potential oversupply in 2025, with global output possibly rising by more than 1.6 million barrels per day. This scenario is contingent on OPEC+ proceeding with its plan to unwind voluntary cuts starting in May. Additional factors contributing to market uncertainty include producers exceeding their quotas and the potential impact of new US sanctions on Iran and Venezuela.

Medium-Term Outlook Remains Unchanged

Despite the revised short-term forecasts, Fitch has kept its medium-term and mid-cycle oil and gas assumptions steady. In the United States, the lower price environment may deter new drilling activities, as industry surveys indicate that many producers require at least $65 per barrel to operate profitably.