A key factor for stabilizing oil prices in 2026 will be the deficit of investments in production - Var Energi

Norwegian company Var Energi ASA, one of the leading oil and gas producers in Northern Europe, expects the global oil market to stabilize in 2026, with prices remaining above $60 per barrel. Company experts believe that a lack of investment in production will be the main factor supporting prices. This is stated in a Bloomberg article, writes UNN.

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According to Bloomberg, Var Energi's management predicts that next year the balance between supply and demand in the oil market will be restored, even despite a short-term oversupply. According to the company's CEO, Nick Walker, there is a structural lack of capital investment in production worldwide, which in the long run will not allow prices to fall significantly.

We may see a brief period of oversupply, but I think when you look at next year, you'll see the supply and demand balance return to normal.

The International Energy Agency also notes that supply growth has continued for over a year, but additional barrels from OPEC+ and independent producers may only temporarily outpace demand growth. Futures prices have been falling for several months in a row, and traders expect a possible further weakening of the market.

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However, according to Var Energi's assessment, the "floor" price of around $60 per barrel is stable: a fall below this level is unlikely, as it would lead to a reduction in investment and a slowdown in production, which would again push prices up.

This year, Var Energi brought several fields into production, including the Johan Castberg field in the Barents Sea and the start-up of Balder X in June. Production from both fields will contribute to an increase in output to approximately 430,000 barrels of oil equivalent per day in the fourth quarter.

To maintain production rates until the end of the decade, the company plans to approve ten new fields by the end of the year, four of which have already been approved with a break-even level below $35 per barrel.

Thus, despite short-term risks, Var Energi expects the oil market to remain in a controlled balance, and the long-term investment deficit will ensure price stability in the industry in 2026.

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