EIA Sees Global Oil Production Rebounding Sharply In 2027

Global crude oil production is expected to fall significantly in 2026 before staging a strong recovery next year, according to the latest forecasts from the US Energy Information Administration (EIA).

The EIA's October Short-Term Energy Outlook projects global crude oil production at an average of 75.40 million barrels per day (bpd) in 2026, down from 79.09 million bpd in 2025.

That would represent a decline of 3.69 million bpd, or approximately 4.7%, year on year.

The agency expects the downturn to be followed by a substantial recovery in 2027, when global production is forecast to average 81.50 million bpd - 6.10 million bpd, or around 8.1%, above the projected 2026 level.

Sharp quarterly swings expected

The EIA expects considerable fluctuations in production during 2026.

Global crude output is projected at 77.33 million bpd in the first quarter before dropping to 71.57 million bpd in the second quarter, a decline of 5.76 million bpd.

Production is then forecast to recover to 75.69 million bpd in the third quarter and 77.02 million bpd in the fourth.

The recovery is expected to accelerate during 2027. Global production is forecast at 79.60 million bpd in the first quarter, rising to 81.30 million bpd in the second, 82.20 million bpd in the third and 82.86 million bpd in the final quarter.

OPEC and OPEC+ output expected to recover

The EIA projects crude oil production by OPEC countries at 20.44 million bpd in 2026, compared with 24.63 million bpd in 2025.

Output is then expected to recover to 24.42 million bpd in 2027.

A similar pattern is projected for the wider OPEC+ grouping. Production is forecast to decline from 33.33 million bpd in 2025 to 29.54 million bpd in 2026 before climbing to 33.38 million bpd next year.

The United States, meanwhile, is expected to follow a different trajectory.

US crude oil production is projected to increase from 13.66 million bpd in 2025 to 13.87 million bpd in 2026 and 14.38 million bpd in 2027.

Production from countries outside OPEC+ excluding the United States is forecast at 31.90 million bpd this year and 33.81 million bpd in 2027.

According to the EIA data, OPEC+ crude oil production capacity is projected to average 20.87 million bpd in 2026 and 26.07 million bpd in 2027, while excess production capacity is estimated at 440,000 bpd and 1.65 million bpd, respectively.

Azerbaijan produces less oil but earns more from exports

The global projections come as Azerbaijan records declining domestic crude oil production in 2026.

According to Azerbaijan's State Statistical Committee, the country produced 17.692 million tons of crude oil, including gas condensate, during January-August 2026.

Production fell by 698,800 tons, or 3.8%, compared with the corresponding period of 2025.

Marketable crude oil accounted for 17.648 million tons of the total, itself a year-on-year decrease of 701,100 tons, or 3.8%.

The value of production across Azerbaijan's mining industry reached 25.7 billion manats ($15.12 billion) during the period, down 1.9% from a year earlier.

The decline in physical oil production, however, has not translated into lower export revenues.

State Customs Committee data show that Azerbaijan exported 14.678 million tons of crude oil and crude petroleum products obtained from bituminous minerals during January-August, generating $9.282 billion.

Compared with the same period of 2025, export revenues increased by $886 million, or 10.6%, even as physical export volumes fell by 1.247 million tons, or 7.8%.

The divergence indicates that Azerbaijan generated considerably more revenue from each ton of crude exported despite shipping less oil abroad.

Italy remained by far the largest destination for Azerbaijani crude.

Azerbaijan exported 8.471 million tons of crude oil and petroleum products worth $5.226 billion to Italy during the first eight months of 2026.

The value of those shipments increased by $424 million, or 8.8%, year on year, despite their physical volume falling by 727,000 tons, or 7.9%.

Italy alone therefore accounted for more than half of Azerbaijan's crude export earnings during the period.

The figures underline two contrasting trends in the oil market. While the EIA anticipates a pronounced contraction in global crude production in 2026 followed by a strong rebound in 2027, Azerbaijan is already experiencing declining production and export volumes.

Yet higher export earnings have so far cushioned the financial impact of that decline, with Azerbaijan earning more from a smaller volume of crude sold abroad during the first eight months of the year.

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