Oil Price Forecast 2023-2050

Current and Future Crude Oil Prices

“Image shows people at a gas station. Text reads: Reasons for Today’s Volatile Oil Prices; Supply limitations by OPEC, The impact of COVID-19 and natural events, Inventories of oil are decreasing globally, High demand (and price) of natural gas in other parts of the world.”

The Balance / Shideh Ghandeharizadeh

Crude oil prices typically fluctuate based on seasonal demand and supply and world events. While economic recovery from the pandemic is well underway, oil prices continue to be affected by global uncertainties and the oil price forecast will reflect this.

Key Takeaways

  • The EIA forecast that Brent crude oil prices will average $95.33/b in 2023.
  • WTI is forecast to average $87.33/b in 2023.
  • Oil prices rise and fall due to fluctuations in supply and demand and global political and economic events.

Current Oil Prices

There are two grades of crude oil used as benchmarks for other oil prices: the West Texas Intermediate (WTI) at Cushing and North Sea Brent. WTI at Cushing comes from the U.S. and is the benchmark for U.S. oil prices. North Sea Brent oil comes from Northwest Europe and is the benchmark for international oil prices.

Internationally, the Brent crude oil price is expected to average $95.33/b in 2023, according to the Energy Information Administration's (EIA) Short-Term Energy Outlook released on November 2022. This is up from an annual average of $70.89 in 2021 and 102.13 in 2022.

West Texas Intermediate averaged $87.55 per barrel in October 2022. The EIA forecasts that WTI prices will average $87.33/b in 2023, down from $95.88 in 2022.


Oil prices are affected by several factors that include everything from the weather to economic and political instability.

The EIA also reports that global oil and liquid fuels demand was 99.82 million b/d in December 2022. However, the EIA expects demand to rise slightly in 2023, reaching an annual average of 100.98 million b/d.

Oil Price Forecast 2025 to 2050

The EIA predicts that by 2025 Brent crude oil's nominal price will rise to $67/b (in 2021 dollars). By 2030, world demand is seen driving Brent prices to $79/b. By 2040, prices are projected to be $84/b. By then, the cheap oil sources will have been exhausted, making it more expensive to extract oil. By 2050, oil prices could be $90/b.

WTI per barrel price is expected to rise to $65 per barrel by 2025, increasing to $71 by 2030, $81 by 2040, and $87 by 2050.

The EIA assumes that demand for petroleum flattens out as utilities rely more on natural gas and renewable energy. It also assumes the economy grows around 1.9% annually, while energy consumption decreases by 0.4% a year.


Future oil prices will depend greatly on innovations in energy, transportation, and other industries as societies work to become less fossil fuel dependent.

5 Reasons for Today’s Volatile Oil Prices

Oil prices used to have a predictable seasonal swing. They spike in the spring as oil traders anticipate high demand for summer vacation driving. Once demand peaks, prices typically drop in the fall and winter.

Global supply and prices are also affected greatly by geopolitical conflict and civil unrest.

Oil prices are more volatile today due to many factors, but five are the most influential.

The Russian Invasion of Ukraine

Russia is the third-largest producer of liquid fuels and petroleum, so when the country invaded Ukraine in late February 2022, it had immediate impact on Brent crude oil futures prices. As the conflict continued, the prices of crude oil settled in out on an upward trajectory, reaching nearly $130/b in early March, and staying well above $100/b into April.

US Oil Supply

The coronavirus pandemic and natural events are still affecting oil demand and supply. The U.S. experienced a drop in production following Hurricane Ida as the storm shut at least nine refineries.

The EIA estimates that U.S. crude oil production will average 12.01 million b/d in 2022 and 12.95 million b/d in 2023.

Diminished OPEC Output

Oil price increases also reflect supply limitations by the Organization of the Petroleum Exporting Countries (OPEC) and OPEC partner countries. In 2020, OPEC cut oil production due to decreased demand during the pandemic. It gradually increased oil output through 2021 and into 2022. Supply chain disruptions in late 2021 affected global trade as well.

At its meeting in October 2022, OPEC stated it would adjust oil production downward by 2 million barrels per day (mb/d) beginning in November 2022. The cut is about 2% of global production.

Natural Gas

Countries in Asia have relied on coal to generate power, but recent shortages have turned them to natural gas. Higher temperatures in parts of Asia and Europe have led to high demand for natural gas to generate power.

As a result, natural gas prices soared in 2021 and remained high in 2022 as Russia blocked deliveries to Europe and should continue to be high through 2023.

Global Inventory Draw

As a reduction in oil production continues globally, countries are forced to draw from their stored reserves (not including the strategic petroleum reserves). This steady draw of oil is contributing to the increase in prices, because inventories are decreasing.

Frequently Asked Questions (FAQs)

What is crude oil?

Crude oil is a liquid found beneath the Earth's surface. It's made up of a mix of hydrocarbons formed by subjecting organic plant and animal material to millions of years of intense heat and pressure. It forms the basis for many petroleum products, including plastic, gas, and lubricating oils.

What is the process that turns crude oil into gasoline?

The refinery process turns crude oil into products like gasoline. One barrel of crude oil (42 gallons) yields around 19-20 gallons of gas, 11-13 gallons of diesel, and 3-4 gallons of jet fuel. Refineries also derive a variety of chemicals and plastics from a barrel of crude oil.

How do you invest in crude oil?

There are many ways to invest in the oil industry, but the most direct way to invest in crude oil as a commodity is with futures contracts. You can also invest in an ETF that replicates exposure to crude oil futures.

How many gallons are in a barrel of oil?

There are 42 gallons in each barrel of oil.

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The Balance uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy.
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