IMF Sees Average Oil Price at $95.74 in 2026

MONTREAL (Oil Monster): The International Monetary Fund expects its benchmark measure of global crude oil prices to average $95.74 per barrel in 2026, up sharply from $67.74 in 2025 as the Middle East conflict, depleted inventories and higher transportation costs continue to affect energy markets.

The assumption, published in the IMF’s October 2026 World Economic Outlook, represents an increase of approximately 41% from last year.

The IMF expects the average oil price to ease to $87.39 per barrel in 2027 as energy supply adapts and some of the disruption affecting production and transportation gradually moderates.

IMF Oil Price Assumption Rises 41% From 2025

The IMF’s $95.74 figure represents its average oil-price assumption for the full year rather than a forecast for a single benchmark such as Brent.

The measure combines spot prices for Brent crude, Dubai Fateh and West Texas Intermediate on an equal basis.

Compared with the $67.74 average for 2025, the 2026 assumption is $28 higher per barrel.

That equates to an increase of approximately 41.3%.

Oil Price Expected to Ease to $87.39 in 2027

The IMF expects some of the current pressure on energy markets to ease next year.

Its average oil-price assumption falls to $87.39 per barrel in 2027, a decline of $8.35, or about 8.7%, from the 2026 level.

Even at that lower level, the assumed oil price would remain substantially above the 2025 average.

The outlook reflects expectations that producers, traders and governments will continue adapting to disrupted Middle East supply chains through alternative production, rerouted shipments and other logistics adjustments.

Natural Gas Prices Expected to Rise 48%

The IMF also expects a substantial increase in natural gas prices during 2026.

Its October outlook assumes natural gas prices rise approximately 48% from 2025 levels.

The increase adds to the pressure facing economies that depend heavily on imported energy, particularly where governments and consumers have limited financial buffers to absorb higher costs.

Energy Importers Face Greater Economic Pressure

Higher oil and gas prices affect economies through several channels.

More expensive fuel raises transportation and industrial costs, increases the import bill for energy-dependent countries and can put additional pressure on currencies and government budgets.

The IMF has repeatedly identified energy-importing emerging and developing economies as particularly vulnerable when higher commodity prices combine with limited fiscal space.

Countries benefiting less from the current technology and artificial-intelligence investment cycle may face an especially difficult combination of higher import costs and weaker growth support.

Global Inflation Rises to 4.7% in 2026

The IMF expects global headline inflation to average 4.7% in 2026 before easing to 4.1% in 2027.

Higher energy and food prices are important contributors to the increase.

Elevated crude, natural gas, transportation and insurance costs can also feed into the prices of manufactured goods and services as businesses pass part of those expenses through to customers.

The IMF has warned that the global disinflation process has stalled as energy-market disruptions continue.

Middle East Conflict Remains a Major Oil-Market Risk

The Strait of Hormuz remains one of the most important risks to the IMF’s energy assumptions.

The near closure of the waterway earlier in the conflict sharply reduced Middle East oil and gas exports and forced producers to rely more heavily on alternative pipelines, tanker transfers and inventory drawdowns.

Gulf producers have since restored significant volumes through a combination of Hormuz traffic and bypass routes.

However, continued tanker attacks and damage to energy infrastructure mean another serious disruption could quickly tighten the market again.

ALSO READ: Hormuz Tanker Attacks Threaten Gulf Oil Export Recovery

Supply Adjustments Prevented a Larger Oil Shock

The global economy has absorbed the Middle East supply shock better than initially feared because producers and governments found ways to replace or reroute part of the lost supply.

Additional production outside the most heavily affected areas, inventory drawdowns, alternative export corridors and reduced demand all helped prevent a larger increase in oil prices.

The IMF has credited Gulf governments in particular with expanding the use of routes outside the Strait of Hormuz and maintaining energy flows to global markets.

The $110 Oil Scenario Was an Earlier IMF Stress Case

The $110-per-barrel figure cited in earlier IMF analysis should be distinguished from the October 2026 baseline.

In its April World Economic Outlook, the IMF modeled a more adverse Middle East conflict scenario in which oil prices averaged approximately $110 per barrel in 2026.

Under that scenario, global growth would have been substantially weaker and inflation significantly higher.

The October baseline of $95.74 reflects the actual market adjustment and updated assumptions several months later.

IMF Still Warns of Further Upside Oil Risk

The IMF’s current baseline does not assume that energy-market risks have disappeared.

Its October outlook continues to identify prolonged Middle East conflict, further energy-supply disruption and renewed commodity-price volatility as significant downside risks for the global economy.

A renewed deterioration in energy infrastructure or shipping could lift oil prices materially above the baseline assumption and increase inflation pressures.

IMF Forecast Differs From EIA and Goldman Sachs

The IMF figure measures a full-year average across three major crude benchmarks, so it is not directly comparable with forecasts for Brent alone.

The U.S. Energy Information Administration currently expects Brent to average $105 per barrel during the fourth quarter of 2026.

Goldman Sachs, meanwhile, recently raised its December Brent forecast to $90 per barrel while maintaining a lower-price outlook for 2027.

Together, the forecasts highlight substantial uncertainty around the pace of Middle East supply recovery and the size of the geopolitical risk premium embedded in crude prices.

ALSO READ: EIA Raises Q4 Brent Forecast to $105

ALSO READ: Goldman Sachs Raises December Brent Forecast to $90

Why the Forecast Matters Beyond the Oil Market

Higher energy prices affect more than producers and refiners.

For energy-importing countries, a higher average crude price can increase trade deficits, weaken currencies and force governments to decide whether to allow fuel costs to pass through to consumers or absorb part of the increase through subsidies and other support measures.

For households and businesses, higher transportation and utility costs can reduce purchasing power and raise operating expenses.

The IMF has therefore identified rebuilding fiscal and energy-security buffers as an important policy priority while the global energy system remains vulnerable.

What Happens Next

The direction of the IMF’s oil-price assumptions will depend largely on the duration of the Middle East conflict, the reliability of crude exports through and around Hormuz, global inventory rebuilding and the response of producers outside the conflict zone.

A faster normalization of energy trade could reduce prices more rapidly than the IMF currently assumes.

Further attacks on production, pipelines, refineries or tankers could instead keep energy prices elevated and intensify pressure on inflation and economic growth.

Frequently Asked Questions

What oil price does the IMF expect for 2026?
The IMF’s October 2026 World Economic Outlook assumes an average oil price of $95.74 per barrel for 2026.

Is $95.74 the IMF’s Brent forecast?
No. The IMF oil-price measure is a simple average of Brent, Dubai Fateh and West Texas Intermediate crude.

How much higher is the IMF’s 2026 oil price than 2025?
The increase from $67.74 to $95.74 is $28 per barrel, or approximately 41.3%.

What does the IMF expect for oil prices in 2027?
The IMF assumes an average oil price of $87.39 per barrel in 2027.

What does the IMF expect for natural gas prices?
Natural gas prices are projected to rise approximately 48% in 2026 compared with 2025.

What is the IMF’s global inflation forecast?
Global headline inflation is projected at 4.7% in 2026 before easing to 4.1% in 2027.

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Hormuz Tanker Attacks Threaten Gulf Oil Export Recovery

Source: International Monetary Fund, October 2026 World Economic Outlook.