Barclays Bank Bearish on Crude Oil

Barclays lowered its 2025 Brent oil price forecast by $4 to $66/bbl and 2026 by $2 to $60/bbl due to OPEC+’s decision to accelerate increases in oil production. “The OPEC+ pivot has also been a significant driver of the move lower in oil prices of late, but tariff-related developments have undoubtedly been a drag,” Barclay said. OPEC+, which is made up of Russia and other allies of the Organization of the Petroleum Exporting Countries, decided on Saturday to accelerate increases in oil production for a second consecutive month, raising output by 411,000 barrels per day in June. OPEC+ sources claim that Saudi Arabia penalizes two members, Kazakhstan and Iraq, for not meeting their production targets, putting pressure on the oil cartel, swiftly reverse previous output cuts. The British bank claims that the OPEC+ decision is more about the strength of the underlying fundamentals and external influence than on member overproduction. Although Barclays now anticipates a slower growth in US oil output, the bank still anticipates OPEC+ will phase out the additional voluntary adjustments by October 2025. According to the report, this reduces their balance estimates by 290 and 110 thousand barrels per day for 2025 and 2026. Additionally, Barclays updated its baseline assessment of OPEC+, predicting that the group will continue its accelerated course of phasing out more voluntary adjustments. From the original plan of 18, it now sees the changes going into effect in six months.