Black gold is losing its shine fast. US crude has slipped below $56 a barrel, with West Texas Intermediate down 23% year-over-year in its worst showing since 2018. The slide reflects a flood of new supply as OPEC+ ramps up output after years of restraint, while markets also price in easing geopolitical risk tied to hopes of a Ukraine-Russia peace deal.

• Brent crude dropped 21% in 2025, marking its worst annual decline since 2020, while settling at $58.92 per barrel.
• Trafigura’s Saad Rahim warned a 2026 “super glut” could emerge as new supply from Brazil, and Guyana collides with slowing demand from China’s EV-heavy fleet.

Storm clouds gathering: Rystad Energy’s Jorge Leon notes that ending Ukraine sanctions would “significantly reduce the risk of near-term Russian supply disruptions” and unleash roughly 170M barrels of Russian oil currently floating on water back into circulation. Trafigura’s Ben Luckock predicts prices could sink into the $50s “across Christmas and the new year” before any recovery materializes. With Trump’s “drill, baby, drill” stance pointing to higher US output, the imbalance between supply and demand is getting harder to ignore.