EIA: U.S. Crude Stocks to Rise More Than Expected in 2026


   
Karim Bastati
DTN Analyst

   VIENNA (DTN) -- The U.S. Energy Information Administration expects 
commercial crude oil inventories to expand faster than expected next year. In 
its short-term energy outlook for December, published Tuesday (12/9), EIA 
estimates stocks to reach 482.3 million bbl by the end of next year, marking a 
5.9% upward revision from November's report. That implies a 12% growth rate for 
domestic crude oil inventories next year.

   Commercial crude stocks were lagging year-ago levels for most of 2025, but 
have recently caught up and are forecasted to end the year at 430.4 million 
bbl, up 4.1% year-on-year. The agency expects crude oil stockpiles to swell to 
484.9 million bbl by the end of the first quarter of 2026. This 3.9% upward 
revision from its previous estimate leads to an implied average stock build of 
more than 600,000 bpd over the first three months of next year.

   This came despite the agency trimming U.S. production expectations. EIA 
forecasts slightly lower production next year than in 2025, as drops in inland 
output from the lower 48 are set to outweigh growth in Alaskan and offshore 
production by some 80,000 bpd.

   On the flip side, planned refinery closures and easing crack spreads suggest 
lower crude oil input rates moving forward. EIA's Short Term Energy Outlook for 
December estimated net inputs into refineries to lag year-ago levels over the 
first nine months of the year, by close to 300,000 bpd on average.

   U.S. inventories are likely to absorb some of the global overhang expected 
for next year. EIA forecasts net imports of crude oil in the first quarter of 
2026 to rise year-on-year, bucking a decade-long trend. Lackluster 
international demand from an oversaturated market would see the drop in exports 
outpace the decline in imports.

   Backwardation in the spreads of West Texas Intermediate futures on NYMEX has 
eased markedly in view of oversupply expectations. WTI's forward curve is 
relatively flat throughout 2026, a stark departure from the steep backwardation 
seen for most of this year, removing an important incentive to keep storage 
levels low.




(c) Copyright 2025 DTN, LLC. All rights reserved.