SEATTLE (Oil Monster): Morgan Stanley has revised its short-term outlook for global crude oil prices, citing OPEC+’s recent decision to temporarily halt planned supply increases. The investment bank now expects Brent crude to average $60 per barrel in the first half of 2026, up from its earlier forecast of $57.50 per barrel.
The revision follows a virtual meeting of OPEC+ members, during which eight participating nations agreed to boost output by 137,000 barrels per day beginning in December. This increase comes as part of a phased reversal of the 1.65 million barrels per day in voluntary production cuts introduced in April 2023. However, the group decided to pause additional production hikes for January through March 2026, citing seasonal demand patterns and market stabilization goals.
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Morgan Stanley noted that actual production levels have continued to lag behind the group’s official quotas. Between March and October 2025, OPEC+ output rose by only 500,000 barrels per day, far short of the 2.6 million barrels per day of planned quota increases for the same period. This ongoing production shortfall has been a key factor in supporting oil prices amid uncertain demand conditions.
Looking ahead, the investment bank anticipates the current market surplus will gradually diminish, achieving supply-demand balance by the second half of 2027. At that point, Morgan Stanley expects Brent crude prices to recover further, reaching around $65 per barrel, driven by tighter market fundamentals and disciplined output management by OPEC+ members.
