06:21 AM EST, 01/15/2025 (MT Newswires) -- Global oil prices are likely to fall this year and next as production outpaces demand, the U.S. Energy Information Administration said in its Short-Term Energy Outlook released on Tuesday.

The agency sees the Brent crude spot price falling 8.6% this year to an average of $74 per barrel from $81 per barrel in 2024. Next year, the price is forecast to fall another 11% to $66 per barrel.

U.S. Crude oil production is expected to increase 2.3% this year to a record 13.5 million barrels per day (b/d) and then to inch up to 13.6 million b/d in 2026.

U.S. electricity demand is forecast to continue growing with industrial sector demand advancing the fastest at 2% in this year and 3% in 2026, the EIA said. Renewable energy sources are projected to contribute a record quarter of U.S. electricity generation in 2025 and 27% in 2026.

The EIA expects the Henry Hub natural gas spot price to bounce back from an all-time low in 2024 to US$3.10 per million British thermal units (MMBtu) in 2025 and US$4/MMBtu in 2026. The increase will be driven by demand growth, led by liquefied natural gas exports, outpacing production growth.