Oil prices retreated on Thursday as major energy forecasters signaled reduced demand expectations for 2026. According to the source, Brent Crude declined 0.5% to settle below $89 per barrel at $88.56, retreating from Wednesday's intraday peak above $89. The U.S. benchmark, West Texas Intermediate crude, fell 0.60% to $82.77 during Asian trading. Both OPEC and the International Energy Agency issued revised demand forecasts that pressured prices downward, even as geopolitical tensions and shipping risks in the Middle East persisted.
The downward revisions reflect softer demand expectations for the coming year, a concern that has begun to outweigh other bullish factors in the market. According to the source, a bearish energy inventory report from the EIA compounded the selling pressure. Traders weighed these demand concerns against ongoing U.S.-Iran diplomatic stalemate and risks to shipping routes in the region, with the latter typically supporting prices.
The forecasts from OPEC and the IEA carry significant weight in energy markets, as they inform investment and production decisions across the industry. Demand outlook cuts often trigger broad-based selloffs in crude markets regardless of near-term supply disruptions, suggesting that longer-term expectations may be taking precedence over current geopolitical risks in price discovery.