Gas and oil prices going lower, and likely to stay low in 2026.

Even though we’ve seen gas prices ride a bit of a roller coaster in recent weeks because of outages at refineries and other one-off disruptions, the overall picture is that gas and oil prices are on the way down.

Oil dropped by the most in a month as a key market gauge flashed weakness and OPEC said global crude supplies surpassed demand sooner than anticipated.

West Texas Intermediate fell more than 3%, wiping out three sessions of gains. The US benchmark’s nearest timespread briefly traded in a so-called bearish contango structure — which means current oil prices are cheaper than contracts for delivery further out — for the first time since February, a fresh sign of the widely anticipated supply glut.

OPEC revised estimates for global oil markets to a third-quarter surfeit from a deficit as US production exceeded expectations and the group itself accelerated output. Worldwide oil supplies exceeded demand by 500,000 barrels a day during the period, the group said.

Good news at the pump, but not so good if you’re one of those US oil producers, because they aren’t going to be getting profits with oil sitting below $59.

At the current price of oil, shale will stagnate or start to decline, industry executives say, while shale producers look to do more with less by raising efficiency in production and capital allocation.

“Fundamentally, the short-term market is a little bearish,” Patrick Pouyanne, the chief executive of supermajor TotalEnergies, said at the Energy Intelligence forum last month.

“There is a point at $60 per barrel where we'll see the shale industry beginning to slow down,” Pouyanne said on the sidelines of the forum. ConocoPhillips chairman and CEO Ryan Lance said that “At $60-$65 a barrel WTI oil prices, the US is probably plateau-ish.”…

“But if prices stay at $60 or go into the $50s, you probably are plateauing or slightly declining,” the executive added.

And the Energy Information Administration said (on Wednesday) that oil and gas prices would continue to go down next year, as part of their Short Term Energy Outlook.

Global oil prices. We expect global oil inventories to continue to rise through 2026, putting downward pressure on oil prices in the coming months. We forecast the Brent crude oil price will fall to an average of $54 per barrel (b) in the first quarter of 2026 (1Q26) and average $55/b for all of next year. Although we continue to expect crude oil prices to fall in the coming months, our Brent forecast for 2026 is $3/b higher than in last month’s outlook, largely as a result of updated assumptions about inventory builds in China and sanctions on Russia.

U.S. gasoline and diesel prices. Our forecast assumes lower crude oil prices, the largest component of retail prices, will contribute to lower retail gasoline and diesel prices throughout the forecast period. We expect gasoline prices to fall below $3.00 per gal (gal) on average in 2026, down 10% from 2024, and diesel prices to fall to $3.50/gal in 2026, down 7% from 2024.

But if you heat your home with gas, you’re going to see prices rise significantly this Winter, and go up even more next year.

Natural gas prices. The Henry Hub natural gas spot price in our forecast rises to an average of almost $3.90 per million British thermal units (MMBtu) this winter (November–March) following seasonal patterns of prices rising during the winter alongside increased space heating demand. We expect prices to average $4.00/MMBtu in 2026, 16% higher than in 2025, primarily due to increased liquefied natural gas (LNG) exports amid flat production growth.

Let’s also remember a main reason gas and oil prices have gotten so low is that Americans don’t use nearly as much gas as they used to, as usage continues to be well below pre-COVID levels.

The usage staying low is even more noteworthy because gas prices are significantly lower than they were 2 and 3 years ago.

It's not below $2 a gallon as our senior President likes to dementedly ramble about, but those lower gas prices are something that can keep overall inflation from getting too high.

The ironic part is that prices for oil are likely to stay so low that Trump/GOP's "drill, baby, drill" deregulation won't likely translate into more drilling over the next year. Because it's not going to be worth it for oil companies to do so.