The Energy Information Administration forecast that oil prices will dip below $60 per barrel this year, putting the Trump administration’s “Drill, Baby, Drill” goals further out of reach. 

In its August Short-Term Energy Outlook released Tuesday, the statistical agency said it is expecting a “significant decline” in oil prices through 2025 and 2026 as global supply continues to outpace demand. 

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The EIA said it expects the price of international benchmark Brent crude to be around $58 per barrel in the fourth quarter of this year, marking the lowest average price seen in one quarter since 2020. 

“There’s a lot of uncertainty in the petroleum market. In the past, we have seen significant drops in oil price when inventories grow as quickly as we are expecting in the coming months,” EIA Acting Administrator Steve Nalley said in a statement. 

EIA is expecting that increased supply will depress prices even further throughout 2026, with the average price nearing as low as $50 per barrel. 

This dip is expected to lead to lower prices at the gas pump for American families, marking a win for President Donald Trump, who promised to slash energy costs. However, EIA warned Tuesday that it could put the administration’s goals of increasing production at risk. 

The agency said it expects lower oil prices will further suppress domestic production, after hitting record levels anticipated later this year. 

“By 2026, declining oil prices lead EIA to expect U.S. producers will pull back on drilling and well completion activity—a trend that has continued through most of 2025,” its outlook read. 

Specifically, EIA said it expects to see crude production to hit a high of nearly 13.6 million barrels per day in December and see an average of 13.3 million barrels per day in 2026. 

The August outlook comes just days after OPEC+ announced it would pump even more oil into the market, by increasing its scheduled production hikes in September by 547,000 barrels per day. 

With global crude supply on the rise, and Trump’s tariffs on products like steel and aluminum still in place, domestic drillers have warned they have little wiggle room to increase production and fulfill the president’s wish to “drill, baby, drill.” 

Kaes Van’t Hof, the CEO of Diamondback Energy, the largest oil producer in the Permian Basin, told investors earlier this month that he believed their production levels have likely already peaked. 

“We continue to believe that, at current oil prices, U.S. shale oil production has likely peaked and activity levels in the Lower 48 will remain depressed,” Van’t Hof wrote in a letter to shareholders, adding that current oil prices remain “unsustainable” for the industry in the long term. 

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He warned that Diamondback Energy dropped four active rigs during the second quarter of this year and expects to complete roughly 10 fewer wells than it previously had hoped. The national rig count has continuously dropped throughout the summer, with Baker Hughes estimating that there are nearly 50 fewer active rigs in the U.S. compared to last year. 

As of around 12:30 pm EST, both international and domestic benchmark prices had dropped to the low to mid-$60s. Brent Crude had dropped by 0.74% and was priced at $66.14 per barrel. Similarly, West Texas Intermediate dipped 1.13% and was selling at $63.24 per barrel.