In an exclusive interview with Khaleej Times, Dr. Daniel Yergin, vice chairman of S&P Global and Pulitzer Prize-winning energy authority, presented a comprehensive outlook for global energy markets heading into 2026. The renowned analyst predicts Brent crude will average approximately $60 per barrel in 2026 before recovering to $65 in 2027, reflecting fundamental shifts in the global energy landscape.
Yergin identifies several critical factors influencing oil markets, noting that supply currently exceeds demand despite vigorous debate about the exact degree of oversupply. He emphasizes that economic fundamentals, political developments, and unexpected events will collectively shape price trajectories. Two particular uncertainties dominate the outlook: the market status of Russian oil amid ongoing sanctions and the trajectory of Chinese demand, which remains obscured by strategic stockpiling activities.
According to Yergin, the globalization paradigm that characterized oil markets for decades has fundamentally fractured following Russia’s invasion of Ukraine, creating a partitioned market structure. This new era of sanctions, tariffs, and protectionism introduces non-economic variables that complicate traditional forecasting models.
Beyond oil, Yergin highlights significant transformations in natural gas markets, where the United States has emerged as the world’s leading LNG exporter within just a decade. He anticipates abundant LNG supplies will pressure prices downward, particularly as Europe permanently reduces dependence on Russian gas. The analyst also notes Gulf countries’ strategic evaluations of their roles as global gas producers.
A central theme in Yergin’s analysis is the escalating electricity demand driven by artificial intelligence infrastructure. He identifies electricity availability as the critical constraint on AI development, noting that natural gas is experiencing a resurgence in power generation despite previous transition expectations. This electricity demand has also renewed interest in nuclear power, with Yergin specifically praising the UAE’s decision to build four nuclear reactors as “a brilliant strategic decision.”
Regarding investment strategies, energy sector experts suggest a cautious approach to oil-related equities given anticipated price weakness, while highlighting stronger fundamentals for natural gas and power infrastructure. They recommend patience with oil stocks and consideration of LNG companies, nuclear utilities, and power producers as alternative energy investments.
Yergin’s upcoming CERAWeek conference in March will focus extensively on AI-energy intersections, LNG market dynamics, oil market developments, and technological innovations across energy industries.