Oil Price Forecast Oil Slip as Iran “Control” Claim and Fast-Tracked Venezuela Deal Test the $60 Floor

Oil Market Snapshot: WTI CL=F Near $59 and Brent BZ=F Around $63

WTI CL=F trades roughly in the $58.7–$59.1 range while Brent BZ=F sits around $63–$63.5 per barrel. The spread near $4–$5 reflects a classic configuration: softer U.S. fundamentals against slightly tighter seaborne benchmarks. The structure is not signaling crisis; it is signaling a market leaning bearish on balances, but still heavily exposed to geopolitical shocks.

Short-Term Tape: WTI CL=F Stuck Under $60 With $55 As the Line in the Sand

Short-term, the WTI CL=F chart is defined by a very clear ceiling and floor. Sellers keep fading every push toward the $60 handle, while most of the professional commentary converges around $55 as the level the market is unlikely to decisively break. This sets an immediate working range of roughly $55–$60. Above $60 you trigger a sentiment reset; below $55 you start pricing in something closer to a genuine demand shock.

The underlying logic is straightforward. Nobody in the physical chain wants another 2020-style collapse. U.S. producers, OPEC+ and consuming economies are all more comfortable with a mid-50s to mid-60s band. Every time futures lean too far below that zone, hedging flows, opportunistic buying and producer caution tend to cap the downside. That is why a test of $55 on CL=F is more likely to attract dip buyers than a free slide into the $40s unless macro data completely cracks.

Brent BZ=F Facing $64–$65 Resistance, Watching $60 As Key Support

Brent BZ=F is fighting overhead supply in the $64–$65 area. Intraday price action shows rallies getting sold before a clean break; technicians are watching the 50-day cluster just below that zone and treating $65 as the first real signal that the bearish narrative is losing control. On the downside, a break of the 50-day average opens a move back toward $60, which is the equivalent psychological anchor on Brent.

The important point is correlation, not identity. Brent and WTI move together, but the seaborne nature of BZ=F means it is more sensitive to shipping, sanctions, and geopolitical trade flows. That is why Brent can sit at $63.5 with Iran headlines and Venezuela rumors swirling, while WTI hesitates closer to $59 and trades more directly against U.S. inventory data and refinery runs.

Macro Tape: Iran Says ‘Under Control’ While WTI CL=F and Brent BZ=F Fade the Risk Premium

The latest leg lower in Brent toward $63.0 and WTI toward $58.7 was driven by one line from Tehran: the foreign minister telling markets the domestic situation is “under total control” after deadly protests. Before that comment, traders had rebuilt a risk premium into the front of both curves on fears that up to roughly 1.9 million barrels per day of Iranian exports could be hit if strikes or sanctions escalated.

Once Iran signaled stability, a chunk of that premium evaporated almost immediately. That is visible in the modest but sharp pullback of about 0.5% in Brent and 0.6% in WTI intraday. It highlights how headline-driven the current environment is. The curve is not being anchored by steady supply-demand models; it is being jerked around by whether Iran looks like losing exports this week or not.

The key risk is asymmetric. If tensions in Iran flare badly enough to threaten Kharg Island exports or transit through Hormuz, you can easily add $5–$10 per barrel in a matter of sessions. If things stay calm, you merely grind around mid-$50s to low-$60s on the back of fundamentals. That skew alone limits how aggressively traders are prepared to short CL=F and BZ=F at current levels.

Venezuela: Storage Deals, Trading Houses, and Why 1 Million bpd Is a Hard Ceiling for Now

Venezuela is the other big moving piece on the supply side, but the signal is more nuanced than “crude flood incoming.” Commodity houses like Vitol and Trafigura have moved first, striking deals to market up to $2 billion worth of Venezuelan crude that has been stranded in floating storage and onshore tanks. Washington and Caracas are working on authorising sales of as much as 50 million barrels, with proceeds locked in U.S. Treasury-controlled accounts.

Trading flows are already being shaped. Venezuelan heavy barrels are being quietly pitched to refiners in India and China for March delivery at discounts of roughly $8–$8.50 per barrel versus ICE Brent on a delivered basis. At the same time, product cargoes like naphtha are moving into Venezuela to dilute the heavy crude, with one shipment expected to arrive on January 28 to help mobilise more exports.

On paper, this looks like supply relief. In practice, the system remains heavily constrained. Venezuelan crude and condensate output was about 1.1 million barrels per day in December and is expected by Energy Aspects to fall to around 950,000 barrels per day this month. Infrastructure is degraded across the chain: wells, gathering systems, pipelines, upgrading units and storage. Rystad-type estimates put the long-term capital requirement to restore Venezuela towards its late-90s peak—near 3 million barrels per day—at well over $180 billion, with timelines measured in decades, not quarters.

So for 2026, the realistic range is whether Venezuela can hold around 1 million barrels per day rather than surge to 2–3 million. The restart of floating storage clear-outs and diluted heavy exports smooths supply; it does not, on its own, create a structural glut.

OPEC, Non-OPEC Growth and the 2.3 Million bpd Surplus Story

At the group level, OPEC pumped about 28.4 million barrels per day in December, roughly 100,000 barrels per day lower than in November, with drops of about 100,000 barrels from Iran and 70,000 barrels from Venezuela dominating the print. That reduction came even as the OPEC+ framework allowed some members to raise output, underlining that actual barrels are struggling to respond to paper quotas.

Against that, Goldman Sachs has set out a very bearish balance sheet for 2026, projecting an average surplus of roughly 2.3 million barrels per day. That surplus, if it materialises, implies rising OECD inventories and a refined product market that will not tolerate aggressive price spikes for long. To slow non-OPEC supply growth and absorb this surplus, Goldman argues prices must fall—citing average 2026 targets of about $56 for Brent and $52 for WTI, with potential lows around $54 and $50 respectively late in the year.

This forecast hinges on several moving parts aligning: robust U.S. shale, new barrels from Guyana and other non-OPEC projects, softer demand via EV penetration and efficiency gains, and no major supply disruption. The moment any of those variables break, the projected 2.3 million barrels per day surplus collapses into a much thinner cushion.

Geopolitical Tail Risks: Why Sub-$50 CL=F Is a High Bar

When you layer Iran and Venezuela onto that balance, the probability of a textbook surplus dominating the tape is far from guaranteed. Iran exports around 2 million barrels per day. Protests have already seen calls for oil workers to strike, and analysts have highlighted that as much as 1.9 million barrels per day of exports could be “at risk” if unrest morphs into operational disruption.

At the same time, U.S. policy is openly weaponising Venezuelan oil. Trump’s administration is talking about “running” Venezuela and keeping revenues from crude sales while pressing U.S. majors to invest billions in the sector. Exxon’s CEO has called the country “uninvestable,” while Chevron is positioning to lift joint venture output by 50–100% over 18–24 months if conditions stabilise. That spectrum—from forced control to cautious re-entry—introduces enormous uncertainty into how many Venezuelan barrels actually show up on the water.

Beyond those two flashpoints, there are multiple tail risks: further sanctions on Russia, instability in other OPEC states, or new theatres of conflict in Asia. Any one of these can wipe out 1–2 million barrels per day of supply or perceived availability. When you start with a theoretical 2.3 million barrels per day surplus and subtract tail risks, it becomes clear why the market is unwilling to price a comfortable, durable $50 handle on CL=F without a major global recession.

Demand, EVs and the ‘Below $60’ Debate for CL=F and BZ=F

On the demand side, the bearish narrative is anchored on three points. First, 2025 saw oil prices fall roughly 20% as OPEC increased output and U.S. shale stayed resilient. Second, EV penetration is finally denting gasoline demand in China and parts of Europe, flattening growth in some road-fuel segments. Third, incremental supply from Guyana, the U.S., and other non-OPEC players is arriving into a world where demand growth is slower than in the 2010s.

Goldman’s call for average 2026 prices of $56 for Brent and $52 for WTI reflects those structural headwinds. But there is a counterargument: world oil demand is still rising in absolute terms, the aviation sector is not fully decarbonised, and petrochemical chains in Asia remain heavily oil-linked. With global population at 8 billion and energy security back at the top of government agendas, it is far from obvious that global oil consumption has peaked in a way that supports a permanent sub-$60 environment.

In other words, demand is no longer a one-way bullish story, but it is also not collapsing. That combination is consistent with CL=F trading in the high-50s to low-60s and BZ=F in the low-60s to high-60s, not a structural grind into the low-40s.

Volatility Drivers: CPI, U.S. Inventories and Time Spreads

Near term, macro data and inventories are the triggers. The U.S. consumer price index print for December will hit at 8:30 a.m. ET and drive rate expectations and dollar strength. A softer CPI supports risk assets and commodities; a hotter print tightens financial conditions and weighs on CL=F and BZ=F.

On the physical side, the American Petroleum Institute’s weekly crude stock estimate on Tuesday and the Energy Information Administration’s detailed Petroleum Status Report on Wednesday will reset the short-term narrative. A sequence of builds would validate the surplus story and keep WTI pinned below $60. A surprise draw, especially if accompanied by strong product demand, would force shorts to cover and test the top of the current range.

Time spreads—the gap between near-dated and deferred futures—are another lever. Goldman points to spreads as a key hedging point. If the market slides deeper into contango, that will confirm oversupply and incentivise storage. If backwardation re-steepens on geopolitical scares, it will signal tight prompt barrels despite the broader surplus story.

2026 Path: Why Oil Above $60 Is Still the Base Case, Not the Tail

One detailed 2026 outlook from the offshore sector argues that, given the current backdrop, it is more likely that Brent and WTI finish 2026 above $60 than significantly below it. The reasoning is simple and data-driven.

Venezuelan production collapsed from roughly 3 million barrels per day in 1999 to under 1 million today over about twenty years, with chronic under-investment and PDVSA’s institutional collapse. Reversing that trajectory to get back to 3 million barrels per day would require close to $200 billion of capital and likely another 15–20 years of stable conditions. Iran faces a similar backlog of capital needs, plus sanctions risk. Neither can quickly flood the market with low-cost barrels.

At the same time, every serious geopolitical flare-up in the last two decades—from the Arab Spring to Russia’s invasion of Ukraine—has been associated with temporary but sharp spikes in oil prices. The current environment is objectively more unstable than the 2010s: Iran unrest, Russia sanctions, Venezuela regime change and heightened great-power tension all co-exist. In that context, the probability that all major producers deliver smooth supply growth while demand drifts gently lower is low.

The result is a forward curve that may reflect Goldman’s $54–$58 Brent band on average but is constantly at risk of trading $10 above that on shocks. That optionality is exactly why long-term offshore projects are being sanctioned on break-evens in the $35–$45 range while spot prices sit in the $60s. The industry does not believe in a stable $50 world; it believes in a volatile $55–$75 band.

Trading Stance on CL=F and BZ=F: Range-Bound, Volatile, and Fundamentally a Hold

Putting all of this together, the message from the data is not screaming trend; it is screaming range and volatility. WTI CL=F has a clearly defined $55–$60 near-term band with fundamental arguments for an average around $52–$56 over 2026 but structural and geopolitical reasons why sustained trading below $50 is unlikely without a severe global downturn. Brent BZ=F likely averages mid-$50s to low-$60s but remains one headline away from spiking into the low-70s.

From an investor’s perspective, that setup does not justify an outright aggressive long or an all-in short at current prices around $59 for CL=F and $63 for BZ=F. The risk-reward is balanced: downside toward $50 on a clean surplus plus weak macro, upside toward $70 if Iran or another producer breaks.

My stance based strictly on the numbers and scenarios above is that crude benchmarks CL=F and BZ=F are a Hold with a tactical sell-the-rally bias at current levels. The structural call is that oil remains supported above $60 on average through 2026, but the immediate tape justifies patience and opportunistic positioning rather than chasing either direction blindly.

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