Canadian Energy Expert Predicts Surge in Oil Prices by 2026, Sees Better Opportunities in Natural Gas Now

Canadian energy expert Eric Nuttall is bearish on oil in the short term but bullish for the long term. He expects a surge in prices next year, anticipating demand to increase. Nuttall is bullish on oil in the next couple of months but expects a buildup in inventory due to increased production and seasonal refinery maintenance reducing demand. He recommends natural gas as a better play for the next six months, highlighting Expand Energy as a top pick.

The International Energy Agency (IEA) has released its latest report, projecting a significant surge in global oil supply while demand growth remains sluggish. The agency expects inventories to build at nearly 3 million barrels per day (bpd) by 2026, setting the stage for a potential glut in the market [1].

According to the IEA, global supply is poised to increase by 2.5 million bpd this year, with non-OPEC+ producers leading the charge. This growth is partly driven by the OPEC+ group's decision to unwind production cuts, which will be fully reversed by the end of September [1]. Meanwhile, demand growth is projected to rise by just 680,000 bpd in 2025 and 700,000 bpd in 2026, significantly lower than initial forecasts [1].

The IEA's outlook is at odds with OPEC's more optimistic projections. OPEC expects stronger demand growth, with global consumption set to hit 106.52 million bpd in 2026, compared to the IEA's forecast of 104.4 million bpd [1]. This discrepancy highlights a sharp divide in market projections, with the IEA being more bearish on demand growth and OPEC more bullish.

Canadian energy expert Eric Nuttall, while bearish on oil in the short term, anticipates a surge in prices next year. He expects demand to increase, potentially leading to a buildup in inventory due to increased production and seasonal refinery maintenance reducing demand [2]. Nuttall recommends natural gas as a better play for the next six months, highlighting Expand Energy as a top pick [2].

The IEA's report underscores the importance of monitoring both supply and demand dynamics in the oil market. As the global economy recovers from the pandemic, the balance between these two factors will be crucial in determining future oil prices and market stability.

References:
[1] https://oilprice.com/Energy/Crude-Oil/IEA-Record-Supply-Surge-Sets-Stage-for-Oil-Stockpile-Blowout.html
[2] https://www.nasdaq.com/articles/petrobras-raises-alarm-over-brazils-new-reference-oil-price-policy