The cost of benchmark Brent and WTI crude oil brands fell by more than 2% due to forecasts of a significant supply surplus in 2026 and US diplomatic activity to end the war in Ukraine. This was reported by Reuters, writes UNN.
Details
On Friday, December 26, the price of Brent crude oil fell by 2.57% to $60.64 per barrel, and American WTI fell by 2.76% to $56.74. Traders are massively selling off contracts ahead of Sunday's meeting between Presidents Volodymyr Zelenskyy and Donald Trump, where the American peace plan will be discussed. The market is factoring in expectations that a potential agreement could lead to a gradual lifting of sanctions on the Russian energy sector and an end to attacks on oil infrastructure.
Oil surplus forecasts
According to the December report of the International Energy Agency (IEA), in 2026, global oil supplies will exceed demand by 3.84 million barrels per day. Analysts at Aegis Hedging note that "geopolitical premiums have provided short-term price support but have not significantly changed the underlying narrative of oversupply." Overall, in 2025, Brent prices fell by 19% and WTI by 21%, which is the strongest annual decline since the pandemic.
The results of the negotiations between Zelenskyy and Trump, which will take place this weekend, are expected to determine the direction of energy prices in early 2026.
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