Forecast overview

• Global oil prices. We expect global oil inventories to continue to rise through 2026, putting downward pressure on oil prices in the coming months. We forecast the Brent crude oil price will fall to an average of $55 per barrel (b) in the first quarter of 2026 (1Q26) and remain near that price for the rest of next year. Although we expect crude oil prices to continue to fall in the coming months, we assess that both the OPEC+ production policy and China’s continued inventory builds will limit price declines.

• Natural gas prices. The Henry Hub natural gas spot price in our forecast rises to an average of almost $4.30 per million British thermal units (MMBtu) this winter (November–March), more than 40 cents/MMBtu higher than we forecast in our November STEO. The revision is driven primarily by colder-than-expected weather in December which we expect will increase space heating demand. However, we expect milder-than-normal weather in early 2026 and rising production will help moderate natural gas prices following the winter, with the Henry Hub price averaging about $4.00/MMBtu next year.

• Electricity generation. Forecast U.S. electricity generation by the power sector grows by 2.4% in 2025 and by 1.7% in 2026. This growth is in contrast to relatively flat generation from 2010 to 2020 and is primarily driven by increasing demand from large customers, including data centers, concentrated in regions managed by the Electric Reliability Council of Texas and the PJM Interconnection. We reduced our forecast for generation growth in 2026 compared with last month’s STEO based on how much large load electricity demand has come online so far this year and its implications for near-term growth.

• Coal consumption. We expect coal consumption to increase by 9% in 2025 driven by an 11% increase in coal consumption in the electric power sector this year as both natural gas costs and electricity demand increased. Coal consumption is expected to fall in 2026 as electric power generation from renewable sources increases. However, coal production falls by less than consumption next year, supporting a small increase in coal exports and rising coal inventories.

You can find more information in the detailed table of forecast changes.