Crude oil prices projected to fall further in 2025

The price of crude oil is projected to average $64 per barrel in 2025, according to the World Bank’s April 2025 Commodity Markets Outlook.

This marks a notable decline from the $80.70 per barrel average recorded in 2024.

The Bretton Woods institution anticipates an even lower average of $60 per barrel in 2026, should current trends persist.

With a relatively stable exchange rate and easing global oil prices, fuel costs at the pump are expected to remain steady, barring any major shocks.

The report attributes the latest downturn in oil prices to heightened concerns over global economic performance, which saw prices dip below $63 per barrel in early April — the lowest level since April 2021.

The downward trend began after the United States imposed major trade tariffs on April 2, triggering a $12 per barrel decline over four trading days.

This episode marked the 11th-largest four-day drop in oil prices since 1990.

While Brent crude had slipped to $70 per barrel by early March 2025, the combined effects of various market forces produced a modest $1 per barrel rise in the first quarter of the year. This partially offset the $5 per barrel drop recorded in the final quarter of 2024.

Demand remains resilient

On the demand side, global oil consumption rose by 1.2 million barrels per day (1.2%) in Q1 2025, up slightly from the 1.1% growth in the preceding quarter.

In China, demand grew by 0.2 million barrels per day (1.4%), compared to 1.0% growth in Q4 2024. Advanced economies also saw a mild rebound in demand, increasing by 0.4 million barrels per day (0.9%), from 0.3% previously.

Throughout 2024, oil demand growth decelerated in China, Europe and Central Asia, and Latin America and the Caribbean, while it picked up pace in East Asia and the Pacific (excluding China), the Middle East and North Africa, and South Asia.

Consumption declined in Sub-Saharan Africa and remained flat across developed economies.

A key reason for the slowdown in China’s oil appetite was the surging uptake of electric vehicles (EVs). In 2024, over 40% of new car purchases in China were EVs, leading to an estimated 0.45 million barrels per day reduction in oil consumption.

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