Oil prices eased on Tuesday as the U.S. Energy Information Administration (EIA) forecast steady domestic oil demand in 2025 alongside a slight increase in supply projections. However, losses were limited by new U.S. sanctions targeting Russian oil exports to India and China.
Brent crude dropped $1.09 (-1.35%) to settle at $79.92 per barrel, while WTI fell $1.32 (-1.67%) to close at $77.50. This followed Monday’s 2% gain after the U.S. Treasury imposed sanctions on Gazprom Neft, Surgutneftegas, and 183 tankers involved in Russia’s shadow fleet.
The EIA’s latest outlook maintained its forecast for U.S. oil demand at 20.5 million barrels per day (bpd) in 2025 and 2026, while revising its domestic production estimate upward to 13.55 million bpd for 2025, up from a previous projection of 13.52 million bpd.
Analysts remain divided on the impact of the new sanctions. ING noted they could potentially eliminate a 700,000-bpd surplus forecast for this year but cautioned that the actual reduction might be smaller as Russia and its buyers find ways to circumvent restrictions.
Additionally, concerns over Chinese demand temper optimism. Official data revealed that China’s crude oil imports fell in 2024 for the first time in two decades, excluding the pandemic years, adding uncertainty to the global demand outlook.