Rystad Energy’s forecast of a 2028 oil supply glut signals potential price pressure and market rebalancing
Executive summary: Rystad Energy’s president Jarand Rystad warned that a massive oil oversupply could re‑emerge in 2028, drawing lessons from the Ormuz strait closure. Such an oversupply could exert downward pressure on oil prices and reshape investment strategies in the energy sector.
Who is involved: Rystad Energy, oil market analysts, and potentially oil‑producing nations and traders.
Likely next: The market may see increased volatility, with producers considering output adjustments and policymakers monitoring supply trends.
The article reports that Rystad Energy’s president Jarand Rystad warned that a massive oil oversupply could re‑emerge in 2028, drawing lessons from the Ormuz strait closure. It cites a projection of excess supply that could affect global pricing. The piece does not provide quantitative estimates but frames the outlook as a market‑driven scenario.
What's next — scenarios
Structural Bear Case: The 2028 Glut Realized (35%)
Rapid erosion of capital expenditure in upstream projects leads to a price collapse as production capacity outpaces demand.
- Aggressive non-OPEC production increases
- Declining global demand growth projections in EIA/IEA reports
Base Case: Controlled Rebalancing (45%)
OPEC+ successfully manages supply through production quotas, maintaining price stability despite growing capacity.
- OPEC+ adherence to voluntary production cuts
- Moderate growth in US shale output
Upside Case: Geopolitical Supply Constraint (20%)
Supply glut forecasts are neutralized by physical disruptions in transit chokepoints, keeping prices elevated.
- Escalation of conflict near the Strait of Hormuz
- Sudden disruption in major maritime shipping lanes
What to watch
- OPEC+ ministerial meeting decisions on production targets (Next 30 days)
- Monthly US EIA crude oil inventory and production data (Next 60 days)
- Global GDP growth revisions by IMF/World Bank (Next 90 days)
- Brent crude futures curve shape (Contango vs Backwardation) (Next 30-60 days)
Timeline
- — Pétrole : « Nous ferons à nouveau face à un excédent massif de l’offre en 2028 » (Le Monde — Économie)
Analysis — what this means
Sectors affected
- Energy
- Transportation
- Manufacturing
- Renewables
Regulatory implications
- Trade policy reviews related to oil imports
Historical parallels
- 1980s oil glut that led to price collapse
- 2014‑2016 price crash after shale boom
- 1970s oil crisis causing supply constraints
Key entities
Sources
- Pétrole : « Nous ferons à nouveau face à un excédent massif de l’offre en 2028 » — Le Monde — Économie
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