Brent at $77/bbl: 3 calls for energy markets

ING expects energy markets to remain volatile in 2027, with Brent averaging $77 per barrel, further OPEC fragmentation as a downside risk, and European TTF gas potentially falling below €40/MWh.

• Oil flows from the Middle East are approaching pre-war levels, although inefficient routes have pushed tanker shipping rates sharply higher.
• ING expects occasional US-Iran flare-ups to preserve a risk premium, while a growing oil surplus should weigh on Brent if disruptions remain limited.
• The UAE has left OPEC, and Venezuela is identified as the most likely next departure after the US capture and arrest of President Maduro in early 2026; Iraq has also challenged the group’s production targets.
• ING’s high-conviction bearish gas scenario depends on Persian Gulf LNG flows normalising in early 2027, allowing TTF to trade below €40/MWh by year-end.
• Higher gas prices are already reducing industrial demand, coal switching is active, milder El Niño weather could lower winter heating demand, and new US LNG capacity plus Qatar’s future capacity could improve European storage before winter 2027/28.

Takeaway: The outlook is modestly bearish for oil and potentially sharply bearish for European gas, but the forecasts carry low conviction because they depend on the absence of prolonged Middle East disruptions and on normalised LNG flows.