1. The EIA path, quarter by quarter
The EIA does not see the oil price crashing but eroding over six quarters: $90.66 in the fourth quarter of 2026, then $84.90, $77.00, $70.03 and $63.94 in the four quarters of 2027 (STEO, 9 September 2026). The 2027 average of $73.74 is about $17 below 2026 ($91) and about $26 below the price on 22 September 2026. WTI follows four dollars lower, at $69.74 for 2027.
| Quarter | Brent | WTI |
|---|---|---|
| Q3 2026 | $89.11 | $84.01 |
| Q4 2026 | $90.66 | $85.98 |
| Q1 2027 | $84.90 | $80.90 |
| Q2 2027 | $77.00 | $73.00 |
| Q3 2027 | $70.03 | $66.03 |
| Q4 2027 | $63.94 | $59.94 |
| 2026 average | $91.00 | $84.65 |
| 2027 average | $73.74 | $69.74 |
For comparison, the crisis year so far: $118.35 on 31 March 2026 at the height of the Hormuz closure, $71.57 on 1 July after the June deal, $96.78 on 24 July after its collapse (Wikipedia), $104.33 on 18 September and $99.97 on 22 September (Fortune, our API). The EIA forecast of 9 September did not contain the September move above $100; its third quarter of 2026 stands at $89.11.
2. Why the price is supposed to fall: surplus, Hormuz, US output
The forecast rests on three assumptions. First the balance: in 2026 the world consumes 1.97 million barrels a day more than it produces; in 2027 it produces 4.90 million barrels a day more than it consumes (Rigzone citing the EIA, 16 September 2026). Inventories, down by around 400 million barrels in 2026, refill in 2027. Second Hormuz: the EIA assumes production shut-ins of 6.7 million barrels a day in August 2026 and constraints persisting into the second quarter of 2027, then normalisation. Third the United States: output rises from 13.8 to 14.3 million barrels a day (STEO).
Goldman Sachs reached similar numbers in June by a different route: $75 for 2027 as a long-term equilibrium, supported by more supply from the US, Brazil, Guyana, Venezuela and the UAE and by demand weakness of which about ten per cent persists after the conflict; the bank put the 2027 surplus at 3.2 million barrels a day (Yahoo Finance, 13 and 21 June 2026). Note that these figures predate the ceasefire collapse of 8 July; we had no more recent Goldman forecast on 22 September. Why surpluses push prices down is explained in our glossary entry on contango and backwardation.
3. What could upset the forecast, up and down
Upside: the whole forecast hangs on Hormuz. If the strait stays constrained beyond the second quarter of 2027, the surplus disappears; the market showed in March 2026 that it then prices $118. Add Russia's refineries under drone attack (export ban until the end of October, Hydrocarbon Processing) and Saudi Arabia's East-West pipeline, which will take six to eight weeks to return to full flow after the 13 September attack (OilPrice.com, 22 September).
Downside: a fast reopening. Iran offered on 22 September to reopen the strait within seven days (Reuters via Israel Hayom); in June Goldman valued a one-month-earlier normalisation at about $10 less for late 2026 and $5 for 2027. If the reopening came in October rather than spring, the EIA path would be too high. The three scenarios are on Hormuz reopening: what happens to fuel prices. And beyond geopolitics, Goldman's demand weakness, China's electric cars and US output all point the same way in 2027: down.
4. What $74 means for heating oil, diesel and petrol
The EIA translates its own path into consumer prices: US heating oil $5.66 a gallon in the fourth quarter of 2026 and $4.31 on average in 2027, diesel $5.55 and $4.40, petrol $3.95 and $3.35 (STEO, 9 September). Diesel and heating oil therefore fall more slowly than crude, because distillate stocks are expected to stay below the five-year low through much of 2027; the gap between diesel and petrol remains unusually wide at $1.05 a gallon (see Why is diesel more expensive than petrol).
For Europe there is no official translation, but a rule of thumb from our methodology: ten dollars a barrel of Brent is about 5.5 euro cents a litre before tax at a rate of 1.14 dollars per euro (see pass-through effect). A fall from $100 to $74 would be worth around 14 cents a litre of heating oil if refining margins and freight follow, which is exactly the open question for 2027. US households that must get through this winter on heating oil find the decision rule on Heating oil: buy now or wait? and the winter outlook on Heating oil price predictions.
See in a minute what Brent at $74, $90 or $118 means for your household.
Calculate my numbers