Morningstar’s outlook for the North American O&G sector in 2026 calls for resiliency despite the prospect for oil and natural gas price volatility. Lingering uncertainty about global trade, the now-paused unwinding of OPEC+ supply cuts, and non-OPEC+ supply growth have prolonged market angst about global crude oil oversupply, keeping pressure on oil prices. The spot West Texas Intermediate (WTI) oil price is currently resting near a four-year low at about $60 per barrel (/bbl).
Key highlights include the following:
— Crude oil prices continue to languish on worries that center on global trade barriers and forecast production growth; geopolitical risk is providing a partial offset/support. There are no credit rating actions expected because of Morningstar’s updated O&G price forecasts.
— There is no change to Morningstar’s 2026 and 2027 WTI and Western Canada Select (WCS) oil price forecasts of $60/bbl and $46/bbl, respectively.
— Morningstar’s 2026 and 2027 NYMEX gas price forecast of $3.50 per thousand cubic feet (/mcf) remains the same. Based on the expectation for continued near-term oversupply in the Western Canada Sedimentary Basin, there is no change to 2026 and 2027 AECO price forecasts of CAD 2.50/mcf and CAD 3.00/mcf, respectively.
“Based on our forecast of global crude oil supply and demand, a moderate global surplus of oil is likely in the first half of 2026,” said Andrew O’Conor, Senior Vice President of Energy & Natural Resources at Morningstar DBRS. “However, our expectation for a moderate H1 2026 surplus could be upended by geopolitical risks that squeeze global supply and boost our full-year 2026 WTI and WCS oil price forecasts.”
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