EIA Outlook: The International Energy Agency (IEA) sharply cut its global oil demand forecast for 2025 due to escalating trade tensions and tariffs imposed by the U.S., which are impacting both consumption and production. The IEA now expects demand to grow by only 730,000 barrels per day, down from a previous estimate of 1.03 million, with the largest reductions coming from the U.S., China, and other Asian economies. Simultaneously, U.S. oil production is projected to slow, partly because tariffs are making drilling equipment more expensive and discouraging shale activity. Despite this, conventional oil projects and non-OPEC+ supply are still expected to grow, potentially leading to a market surplus. Falling oil prices are putting financial strain on oil-dependent governments, prompting policy responses such as increased borrowing and spending cuts.

Emerging Markets Strained by Oil Price Drop:  Emerging market oil exporters are facing significant budgetary pressure due to the steep decline in oil prices driven by U.S. tariffs and escalating trade tensions. Countries like Angola and Nigeria, heavily reliant on crude revenue, are experiencing financial strain, with Angola recently forced to cover a $200 million margin call. The downturn is also unraveling debt trades and raising credit risk premiums across frontier markets. While oil importers such as Turkey and India may benefit from reduced costs, those gains are offset by broader economic risks tied to the global slowdown. Analysts warn that prolonged low prices could stall or reverse reform efforts in several vulnerable economies.

Russia's oil and fuel export revenue:  Russia's oil and oil product revenues fell 21% year-over-year in March to $14.29 billion due to lower prices and reduced exports, according to the International Energy Agency (IEA). Total oil and fuel exports dropped by 600,000 barrels per day (bpd) compared to March 2024, driven in part by widening discounts on Russian crude. Despite falling output, Russia’s production remains slightly above its OPEC+ quota, though U.S. sanctions introduced in January have added pressure. Kazakhstan, meanwhile, exceeded its OPEC+ target by 390,000 bpd, with production increases tied to Western-led expansion projects. The IEA noted that strong demand for sour crude limited further discounting of Russia's Urals grade, especially in markets like India.

Market Overview: On April 15, oil prices dipped slightly as the International Energy Agency (IEA) followed OPEC in sharply cutting its global oil demand forecast. West Texas Intermediate (WTI) crude fell by 50 cents, or 0.8%, to $61.03 per barrel. The IEA reduced its demand growth estimate to 730,000 barrels per day for this year, citing growing trade tensions and economic slowdown concerns. Despite the downward pressure, prices were partially supported by U.S. President Trump's consideration of tariff exemptions and comments from the U.S. Energy Secretary about halting Iranian oil exports. Additionally, China's crude imports rose nearly 5% year-over-year in March, offering a modest boost to market sentiment.

Crude Movement Since January 20th

The Eagle Ford region in southwest Texas is projected to increase its natural gas production from 6.8 Bcf/d in 2024 to 7.0 Bcf/d by 2026, driven by higher gas prices and growing LNG export demand. Oil production in the region is expected to remain steady at around 1.1 million b/d through 2026. This trend reflects rising gas-oil ratios due to reservoir pressure declines, leading to proportionally more gas output. The Eagle Ford play dominates the region’s production, accounting for 73% of natural gas and 86% of oil, while showing modest growth in gas and a slight decline in oil since 2020. The Austin Chalk play, though smaller, is the fastest-growing, with gas production nearly tripling and oil increasing by 26% over the same period.

Oil prices remained largely unchanged on Tuesday as markets weighed the impact of President Trump's shifting tariff policies and the ongoing U.S.-China trade war. West Texas Intermediate (WTI) crude slipped slightly by 12 cents to $61.41 per barrel. The uncertainty from the trade conflict led OPEC to lower its demand forecast, while the International Energy Agency predicted the slowest global oil demand growth in five years. Major banks such as UBS, BNP Paribas, and HSBC cut their crude price forecasts, citing risks of recession and a hard landing in China. So far this month, oil prices have dropped around 14%,pressured by trade tensions and increased output from OPEC+. Meanwhile, U.S. oil inventory data is expected to show a drawdown of about 1 million barrels, compared to historical averages. In Europe and China, economic concerns tied to tariffs have dampened outlooks, with China urging market diversification and Germany seeing a sharp dip in investor confidence.