Oil supply wells are about to gush! The global crude oil market may face an oversupply dilemma by 2026

If the Russia-Ukraine conflict develops towards peace, this should originally be good news, but it could become a heavy blow to oil prices. The latest market dynamics show that crude oil continues to decline under pressure. On November 24, WTI crude oil fell to $57.80 per barrel (down 0.29%), and Brent crude oil dropped further to $61.64 per barrel (down 1.41%), marking the fourth consecutive trading day of decline.

Peace Agreement Becomes a Pressure Point for Oil Prices

The Trump administration is actively pushing for Ukraine to agree to end the Russia-Ukraine conflict by the end of the month. Once an agreement is reached and U.S. sanctions on Russia are lifted, Russian oil will re-enter the international market, directly exacerbating the global oil supply surplus. The market has already priced in this expectation, and the bearish factors of increased supply continue to push oil prices lower.

Clear Downward Trend in 2025, More Worries in 2026

Since the beginning of this year, WTI and Brent crude oil have fallen by a total of 19%, mainly due to continuous global production expansion—OPEC+’s increased output plans, stable U.S. shale oil exports, and the potential return of Russian supplies—all jointly pushing down oil prices.

The International Energy Agency’s forecast is even more alarming: crude oil supply will hit record highs in 2026. Robert Rennie, Head of Commodity Research at Westpac Banking Corporation, pointed out that if sanctions are lifted, allowing Russian oil to flow fully into the market, Brent crude oil prices will be capped at above $65 per barrel and are expected to decline further in 2026.

Goldman Sachs Presents Shocking Numbers

Goldman Sachs estimates that by 2026, the global oil market will have a massive surplus of 2 million barrels per day, which will drive crude oil prices to plummet significantly before mid-2024. Specifically, the average price of Brent crude oil could fall to $56 per barrel, and WTI crude oil may drop to $52 per barrel.

From the current trend in oil prices, the market has already begun to preemptively react to the supply risks in 2026, and short-term oil prices are unlikely to improve.