• Former President Donald Trump forecasts oil prices will soon fall below $60 a barrel, a view now supported by major banks and government analysts.
  • The sell-off has already begun, with crude dropping over $2/barrel following the election on expectations of a stronger dollar and pro-production policies.
  • OPEC+ is accelerating the end of its production cuts, adding significant supply to a market where global output is already outpacing sluggish demand.

Donald Trump’s recent prediction of a slide in oil prices below $60 a barrel is moving from campaign rhetoric to market reality. Independent forecasts from the U.S. Energy Information Administration and major financial institutions now align with the former president’s view, projecting Brent crude will average less than $60 in the fourth quarter of 2025.

The market is already pricing in this new era. Since the election, crude has slipped by more than $2 a barrel as traders anticipate policy shifts that favor domestic production and a stronger U.S. dollar, which typically pressures dollar-denominated commodities. According to people familiar with the matter, the sell-off was triggered by algorithmic trading models reacting to the heightened probability of these outcomes.

This bearish outlook is fundamentally underpinned by a simple equation: too much supply and not enough demand. The EIA’s August Short-Term Energy Outlook projects prices could hover near $50 through 2026. A major factor is the anticipated unwinding of OPEC+ production cuts, which the cartel is now expected to accelerate, with cuts fully phased out by September 2025. This will flood the market with millions of additional barrels daily.

“What institutional investors are really focused on is regulatory stability for production, and that is what this administration is expected to deliver,” said one energy analyst, who asked not to be named because they were not authorized to speak publicly. This deregulatory push, including potential reversals of Biden-era costs for drillers, is designed to stimulate U.S. output, further exacerbating the global supply glut.

Bank surveys, including one by Haynes Boone, reflect this consensus, with expectations for WTI crude to average approximately $58.30 in 2025. The rapid changes in federal leasing and royalty structures are anticipated to bolster medium-term U.S. production, even if it pressures the margins of higher-cost shale producers in the near term.

Efforts to reach representatives at the EIA for further comment on the timing of these forecasts were unsuccessful. The agency’s public reports, however, cite rising inventories and tepid global demand growth, particularly from China and Europe, as primary drivers for the prolonged downturn.

For consumers, the silver lining is clear: cheaper gasoline and diesel prices, which would help ease inflationary pressures. For producer nations and some U.S. energy firms, however, the landscape looks challenging. Countries reliant on oil revenues are already revising budget forecasts downward, and sector M&A activity is rising as companies seek scale to weather lower revenues.

While any major geopolitical event could alter this trajectory, the current consensus suggests a prolonged period of lower prices. As one trader noted, “The policies favor more oil, not higher prices. That’s the trade now.”