EIA Raises Oil Price Forecasts, Citing Iran War Drawdown of Global Stockpiles

The U.S. Energy Information Administration lifted its oil price forecasts, pointing to the ongoing war involving Iran as the reason global stockpiles have been shrinking faster than previously expected. The agency's forecasts are closely watched by traders because they set a benchmark for where supply and demand are expected to balance over coming quarters. A sustained drawdown in global inventories tends to support higher prices because it leaves less cushion against future supply shocks. Energy stocks and crude futures typically react to EIA revisions on the day they are published, though the wire item did not include the specific price levels the agency now expects. What is unresolved is how long the conflict continues to affect flows out of the region and whether other producers increase output to offset the shortfall. The EIA also said U.S. natural gas supply and demand are set to hit record highs in 2026, a separate signal that domestic energy markets are expanding even as the oil market tightens.