On the last day of 2025, the energy world is caught between ambition and reality. We are 25 years from net zero, yet still deeply reliant on oil. Even so, and despite lingering geopolitical tensions across key producing regions, oil prices have stayed comfortably below the $100-a-barrel mark. As we enter the new year, most analysts expect oil to remain well below even the $60/b mark. Even if prices rally, most expect no dramatic spikes, with Brent, the world’s main crude benchmark, likely to remain in a sweet spot in the $60s.
This may not be the best news for Middle Eastern crude producers whose economies and spending plans hinge on higher oil revenue. However, for billions of people around the world, lower oil prices mean cheaper travel, cheaper goods and a more affordable cost of living.
As the year ends, I take a look at the trends likely to shape oil prices and demand over the next 12 months.
Oil prices, or specifically benchmark Brent, are set for a muted start to the year, after posting their steepest annual decline since 2020, after the height of the Covid-19 lockdowns.
As my colleague Fareed Rahman writes, the oil market is moving into a phase of structural imbalance, with supply growth expected to run at around three times the pace of demand despite steady gains in consumption.
What does the demand outlook look like in 2026?
Global oil demand is expected to rise by about 900,000 barrels per day in 2025, taking total consumption to roughly 105.5 million bpd. A similar increase is forecast for 2026, with growth picking up further in 2027.
Where is the imbalance?
Supply is set to grow much faster than demand in 2025 and 2026, at roughly three times the pace. That expansion is being driven by higher output from both Opec+ and non-Opec producers.
What’s the impact on price?
Brent crude is likely to slip below $60/b in 2026, fall into the low $50s by Q4 and potentially end the year at even lower levels, according to Ahmad Assiri, a research strategist at Australia-based broker Pepperstone. UBS expects Brent to trade between $60 and $70 a barrel next year, with only brief excursions outside that range.
2025 has been a year of sanctions and captured oil tankers, whether they’re Russian, Iranian or Venezuelan. With so much embargoed oil in the sea, it is unsurprising that oil prices remain depressed. But with oil tankers floating with no specific destination in sight, does it imply a collapse in demand?
Kpler’s Amena Bakr writes that the build-up of crude at sea does not mean lower demand. She points to the persistent decline in product stocks, which shows people are still consuming even if unrefined crude still remains lost at sea.
Why is there oil on water?
Since early September, an additional 215 million barrels of crude have accumulated at sea, increasing oil-on-water volumes by about 19 per cent, according to analysts at Kpler. Total oil floating on the water is now around 1.3 billion barrels.
Is this a 2020 repeat?
Not quite. While the surplus is becoming more visible, it remains manageable. Unlike 2020, when storage ballooned as demand collapsed, today’s build-up is happening alongside healthy product demand and strong refining margins.
Could this surplus find buyers?
Yes. Pricing dynamics, including discounts on crude, particularly Russian Urals, are likely to encourage additional buying, particularly from major importers such as India and China.
Jargon buster
Inventory: While it could mean a number of things outside the energy world, traders use this word to describe stockpiles of crude oil and refined products such as gasoline and diesel.
Big number
$100 per barrel
Once the oil market’s north star, $100 crude last flashed on screens in 2022 after Russia’s invasion of Ukraine. As the industry looks ahead to 2026, that price point is increasingly a relic of the oil age.
Our top energy reads
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Key features of new policy
Pupils to learn coding and other vocational skills from Grade 6
Exams to test critical thinking and application of knowledge
A new National Assessment Centre, PARAKH (Performance, Assessment, Review and Analysis for Holistic Development) will form the standard for schools
Schools to implement online system to encouraging transparency and accountability
Lexus LX700h specs
Engine: 3.4-litre twin-turbo V6 plus supplementary electric motor
Power: 464hp at 5,200rpm
Torque: 790Nm from 2,000-3,600rpm
Transmission: 10-speed auto
Fuel consumption: 11.7L/100km
On sale: Now
Price: From Dh590,000
The specs
Engine: 2.0-litre 4cyl turbo
Power: 261hp at 5,500rpm
Torque: 405Nm at 1,750-3,500rpm
Transmission: 9-speed auto
Fuel consumption: 6.9L/100km
On sale: Now
Price: From Dh117,059
Day 5, Dubai Test: At a glance
Moment of the day Given the problems Sri Lanka have had in recent times, it was apt the winning catch was taken by Dinesh Chandimal. He is one of seven different captains Sri Lanka have had in just the past two years. He leads in understated fashion, but by example. His century in the first innings of this series set the shock win in motion.
Stat of the day This was the ninth Test Pakistan have lost in their past 11 matches, a run that started when they lost the final match of their three-Test series against West Indies in Sharjah last year. They have not drawn a match in almost two years and 19 matches, since they were held by England at the Zayed Cricket Stadium in Abu Dhabi in 2015.
The verdict Mickey Arthur basically acknowledged he had erred by basing Pakistan’s gameplan around three seam bowlers and asking for pitches with plenty of grass in Abu Dhabi and Sharjah. Why would Pakistan want to change the method that has treated them so well on these grounds in the past 10 years? It is unlikely Misbah-ul-Haq would have made the same mistake.
PREMIER LEAGUE FIXTURES
Saturday (UAE kick-off times)
Watford v Leicester City (3.30pm)
Brighton v Arsenal (6pm)
West Ham v Wolves (8.30pm)
Bournemouth v Crystal Palace (10.45pm)
Sunday
Newcastle United v Sheffield United (5pm)
Aston Villa v Chelsea (7.15pm)
Everton v Liverpool (10pm)
Monday
Manchester City v Burnley (11pm)
Who's who in Yemen conflict
Houthis: Iran-backed rebels who occupy Sanaa and run unrecognised government
Yemeni government: Exiled government in Aden led by eight-member Presidential Leadership Council
Southern Transitional Council: Faction in Yemeni government that seeks autonomy for the south
Habrish 'rebels': Tribal-backed forces feuding with STC over control of oil in government territory
UAE currency: the story behind the money in your pockets
Scores in brief:
Boost Defenders 205-5 in 20 overs
(Colin Ingram 84 not out, Cameron Delport 36, William Somerville 2-28)
bt Auckland Aces 170 for 5 in 20 overs
(Rob O’Donnell 67 not out, Kyle Abbott 3-21).
The Bio
Favourite Emirati dish: I have so many because it has a lot of herbs and vegetables. Harees (oats with chicken) is one of them
Favourite place to go to: Dubai Mall because it has lots of sports shops.
Her motivation: My performance because I know that whatever I do, if I put the effort in, I’ll get results
During her free time: I like to drink coffee - a latte no sugar and no flavours. I do not like cold drinks
Pet peeve: That with every meal they give you a fries and Pepsi. That is so unhealthy
Advice to anyone who wants to be an ironman: Go for the goal. If you are consistent, you will get there. With the first one, it might not be what they want but they should start and just do it
Results:
5pm: Abu Dhabi Fillies Classic (PA) Prestige Dh 110,000 1.400m | Winner: AF Mouthirah, Tadhg O’Shea (jockey), Ernst Oertel (trainer)
5.30pm: Abu Dhabi Colts Classic (PA) Prestige Dh 110,000 1,400m | Winner: AF Saab, Antonio Fresu, Ernst Oertel
6pm: Maiden (PA) Dh 80,000 1,600m | Winner: Majd Al Gharbia, Saif Al Balushi, Ridha ben Attia
6.30pm: Abu Dhabi Championship (PA) Listed Dh 180,000 1,600m | Winner: RB Money To Burn, Pat Cosgrave, Eric Lemartinel
7pm: Wathba Stallions Cup (PA) Handicap Dh 70,000 2,200m | Winner: AF Kafu, Tadhg O’Shea, Ernst Oertel
7.30pm: Handicap (PA) Dh 100,000 2,400m | Winner: Brass Ring, Fabrice Veron, Ismail Mohammed
Zayed Sustainability Prize
HAJJAN
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Spec%20sheet
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The Penguin
Starring: Colin Farrell, Cristin Milioti, Rhenzy Feliz
Creator: Lauren LeFranc
Rating: 4/5
START-UPS%20IN%20BATCH%204%20OF%20SANABIL%20500'S%20ACCELERATOR%20PROGRAMME
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If you go
The flights
There are various ways of getting to the southern Serengeti in Tanzania from the UAE. The exact route and airstrip depends on your overall trip itinerary and which camp you’re staying at.
Flydubai flies direct from Dubai to Kilimanjaro International Airport from Dh1,350 return, including taxes; this can be followed by a short flight from Kilimanjaro to the Serengeti with Coastal Aviation from about US$700 (Dh2,500) return, including taxes. Kenya Airways, Emirates and Etihad offer flights via Nairobi or Dar es Salaam.
The five pillars of Islam
