The United States is planning a major increase in energy production.
On December 5th local time, US President Trump signed a Senate resolution into law, lifting drilling restrictions on some parts of the Alaska North Slope National Oil Reserve. This move is part of his efforts to improve US energy... As part of the production plan.
Looking ahead to the global oil market, the International Energy Agency (IEA) recently stated in a report that the widely anticipated "supply surplus" in the oil market in 2026 could reach 4 million barrels per day. (JPMorgan Chase) Warnings indicate that Brent crude oil prices could fall to $58 per barrel by 2026, impacting the oil industry . We are about to face a difficult period.
Trump's latest signing
On December 6, according to CCTV News, the White House issued a statement on December 5 local time, saying that Trump signed a Senate resolution that day, making it law, to lift some drilling restrictions in the Alaska North Slope National Oil Reserve.
These restrictions were reportedly originally intended to protect environmentally sensitive areas from damage caused by oil and gas drilling.
The Alaska National Oil Reserve covers an area of approximately 23.5 million acres and is located west of the Pruddo Bay oil field in Alaska.
In 2017, the U.S. Geological Survey estimated that the oil reserve contained 8.7 billion barrels of recoverable oil. In 2024, former U.S. President Biden ordered a ban on leasing out 10.6 million acres of the reserve for exploitation, citing reasons such as wildlife protection, and imposed additional restrictions on the development of another 2 million acres.
The U.S. Energy Information Administration (EIA) stated in its November Short-Term Energy Outlook that Alaskan crude oil production is projected to reach 477,000 barrels per day in 2026, which would be the highest level since 2018. The EIA indicated that Alaskan oil production is expected to grow by 13%, or 55,000 barrels per day, representing the largest annual increase since the 1980s.
Trump has been interested in developing Alaska's oil reserves as part of his broader plan to increase U.S. energy production and reduce imports.
Zheshang Securities In a previous research report, Chief Economist Li Chao pointed out that since taking office, Trump has used three main measures to reduce energy prices: first, relaxing environmental regulations in the United States, which may accelerate the implementation of related investments and the issuance of oil and gas exploration and production leases; second, declaring a national energy emergency to accelerate drilling, development, and production; and third, requiring OPEC to increase production.
Wall Street warns: Oil prices may fall in 2026
The dominant theme in the global crude oil market this year has been oversupply, and this situation may continue for the next year. Despite better-than-expected demand, global crude oil supply continues to rise.
Data from the EIA shows that U.S. shale oil producers are expected to reach record production levels in December.
In addition, global oil tanker inventories have exceeded 1 billion barrels, the highest level since 2023. The IEA predicts that the global crude oil surplus may reach 4 million barrels per day in 2026.
Commodity strategists at top Wall Street investment banks generally expect 2026 and 2027 to be tough years for the oil industry .
In the baseline scenario set by JPMorgan's commodities team, led by Natasha Kaneva, the international benchmark oil price, Brent crude (BZ=F), will fall to $58 per barrel in 2026, while the US benchmark oil price, West Texas Intermediate (CL=F), will be $4 lower than that level. The agency also predicts that oil prices will fall another $1 per barrel in 2027.
In a recent report, JPMorgan strategists wrote: "It may be a cliché, but since June 2023, we have consistently conveyed the same message to the market: despite strong global oil demand, supply is simply too abundant."
Goldman Sachs In the commodities sector, led by Daan Struyven, a similar benchmark forecast was given: Brent crude and West Texas Intermediate crude will be priced at $56/barrel and $52/barrel respectively in 2026.
Goldman Sachs predicts that oil prices will receive more robust support in the coming years—Brent crude and West Texas Intermediate crude will rise to $80/barrel and $76/barrel respectively by 2028. This prediction is based on the premise that "oversupply will no longer dominate the market."
Goldman Sachs analysts wrote in a report: "We expect oil prices to rebound in 2027, as the market will rebalance and the market focus will shift to 'incentivizing investment through reasonable oil prices' as crude oil reserve lifespans shorten, the U.S. shale oil industry matures, and demand grows steadily."
Macquarie Bank Australia Analysts also stated that, given the expectation of an "exceptionally severe oversupply" in the global oil market, the bank is bearish on oil prices in 2026.
Macquarie analysts wrote in a report to clients, "As a baseline expectation, current market conditions will lead to a 'significant oversupply' in the fourth quarter of 2025 and the first quarter of 2026, which could force a sharp drop in oil prices and require OPEC to adjust its policy direction." The bank forecasts that Brent crude and West Texas Intermediate crude will be priced at $60.75 per barrel and $56.63 per barrel, respectively, in 2026.
(Source: Securities Times)
