June 15th News
On June 12, the international crude oil market experienced a sharp downturn, with prices of the two major crude oil futures falling by more than 3% each, hitting a temporary low. Refined oil prices also declined in tandem. The core driver behind this round of sharp oil price drop is the market’s anticipation that the U.S. and Iran are about to reach a peace memorandum of understanding, coupled with downward revisions in global oil demand forecasts—both factors jointly weighing on oil market sentiment. Meanwhile, the persistently tight supply situation and diverging U.S. onshore drilling data have created a complex scenario in which bullish and bearish forces are intertwined, making the future trajectory of crude oil prices highly uncertain.
I. Market Trends: Futures prices closed sharply lower, with all types of oil products experiencing a broad-based decline.
At the close on June 12, New York time, international crude oil and related refined oil products collectively declined, reaching their lowest levels in recent times. The July contract for U.S. WTI crude oil futures fell by $2.83, a price decrease of 3.23%, settling at $84.88 per barrel—the lowest level since April 17. Brent August crude oil futures dropped by $3.05, a price decrease of 3.37%, settling at $87.33 per barrel—a low not seen since early March.
In the refined oil market, market sentiment has weakened in tandem. In August, RBOB gasoline futures fell by 1.94%, closing at $2.9867 per gallon; July heating oil futures prices declined by 3.09%, settling at $3.4044 per gallon. Overall, the petroleum products sector is under significant pressure.
II. Factor Analysis: Increased Supply Expectations & Lowered Demand Growth Forecasts
U.S.-Iran negotiations are nearing a breakthrough, and easing supply expectations trigger a sharp decline.
The core driver behind this sharp pullback in oil prices is the substantial progress made in U.S.-Iran peace agreement negotiations, which has rapidly boosted market expectations for a recovery in crude oil supplies from the Middle East. According to multiple authoritative sources, the two sides have entered the final stage of reaching an agreement: senior U.S. government officials openly stated that there is an 80% to 85% probability of signing a memorandum of understanding in the coming days, and they believe Israel will lend its support. On the Iranian side, it was also confirmed that the two sides have reached consensus on most issues and are now finalizing the text of the memorandum, with internal review processes continuing to advance. The Pakistani Prime Minister indicated that the U.S. and Iran have finalized the draft text of the peace agreement, and all parties are now moving forward with the subsequent implementation procedures.
Market consensus generally holds that once the U.S. and Iran reach a settlement, geopolitical tensions in the Middle East will ease significantly, easing constraints on regional crude oil supplies and causing the geopolitical risk premium for crude oil to fade—thus directly triggering the sharp drop in oil prices seen in this round. However, industry insiders also caution that with the peak summer driving season approaching, seasonal demand could still provide some support for oil prices, meaning that short-term oil prices are unlikely to trend downward unilaterally.
Institutions Lower Long-Term Oil Price and Demand Forecasts, Medium- to Long-Term Supply and Demand Balance Changes
Global oil demand forecasts have been revised downward, further intensifying bearish sentiment in the market. This week, OPEC once again lowered its 2026 global oil demand growth forecast, reducing the full-year average daily demand increase from 1.17 million barrels to 970,000 barrels. This marks the second consecutive time that the organization has cut its demand growth projection. However, OPEC remains optimistic about medium- and long-term consumption, raising its 2027 global average daily demand increase to 1.73 million barrels—up by 190,000 barrels from its previous estimate—and forecasting that oil consumption will rebound in the period ahead. In contrast, since the outbreak of the Middle East conflict, OPEC’s assessments of oil consumption have consistently been more optimistic than those of institutions such as the EIA and IEA.
International investment banks have also revised their oil price forecasts accordingly. Based on the outlook of rising global supply and weakening demand, Goldman Sachs has lowered its forecast for the average Brent crude oil price in 2027 to $80 per barrel. At the same time, Goldman Sachs pointed out that, influenced by factors such as OECD crude oil inventories and potential supply disruptions, oil prices next year will still remain above the 2025 average.
U.S. Drilling Data Diverges, Domestic Production Signals Mixed Outlook
U.S. oil and gas rig data showed their first decline in eight weeks, signaling a slight adjustment in the industry’s production pace. As of the week ending June 12, the total number of U.S. oil and gas rigs fell by one to 562. The performance of individual subcategories diverged markedly: the number of oil drilling rigs rose by two to 433, reaching its highest level since June 2025, reflecting continued strong willingness to boost U.S. crude oil production; meanwhile, the number of natural gas drilling rigs declined by three to 121, hitting its lowest level since October 2025, indicating a clear trend of shrinking natural gas production. As a leading indicator of crude oil output, the rising number of oil rigs suggests that U.S. domestic crude oil supply could continue to grow, adding downward pressure on oil prices in the medium to long term.
III. Outlook for the Future Market: A Mix of Bullish and Bearish Factors Ahead—Oil Market Likely to Remain in a Volatile Range
Crude oil analysts believe that, in the short term, the pace of implementation of the U.S.-Iran agreement remains the key factor influencing oil prices. If the Memorandum of Understanding is formally signed, geopolitical premiums will further erode, and oil prices could continue to trend weaker. Conversely, if negotiations encounter setbacks, oil prices would rebound rapidly. In the medium term, slowing growth in global oil demand and the steady increase in U.S. crude oil production capacity will continue to put downward pressure on prices. However, seasonal summer demand for oil, global crude oil inventory levels, and the risk of sudden supply disruptions will all limit the room for oil prices to fall further. Overall, the current crude oil market is characterized by a complex interplay of bullish and bearish factors. In the short term, prices are likely to remain volatile and generally weak. Going forward, it will be crucial to closely monitor the implementation of the U.S.-Iran agreement, OPEC+ producers’ policies, and changes in global crude oil consumption data.
