EIA Short-Term Energy Outlook — April 2026

Institution: U.S. Energy Information Administration (EIA)

Date: April 7, 2026

URL: https://www.eia.gov/pressroom/releases/press586.php

File: eia-april-2026-steo.md

Summary

The EIA's April 2026 STEO provides the official U.S. government forecasts for energy prices and production in the context of the ongoing Strait of Hormuz closure. It projects Brent crude peaking at $115/barrel in Q2 2026, U.S. retail gasoline reaching $3.70/gal average for the year, and collective Gulf production shut-ins rising to 9.1 million b/d in April before gradually recovering. The outlook is explicitly contingent on the duration of the Hormuz closure, which the EIA acknowledges has no historical precedent.

Key Findings

**Global oil production shut-ins:** Iraq, Saudi Arabia, Kuwait, UAE, Qatar, and Bahrain collectively shut in **7.5 million b/d** in March 2026, rising to **9.1 million b/d in April**. Under the assumption the conflict does not persist past April, shut-ins fall to 6.7 mbd in May and return near pre-conflict levels by late 2026. (EIA STEO, April 2026)

**Brent crude oil price:** Averaged **$103/barrel in March 2026**; expected to peak at **$115/b in Q2 2026** before easing. Forecast falls below $90/b in Q4 2026, averaging **$76/b in 2027**. A "risk premium" is maintained throughout the forecast period. (EIA STEO, April 2026)

**Retail gasoline price:** Expected to peak at close to **$4.30/gallon in April 2026**; annual average forecast of more than **$3.70/gal in 2026**. Diesel peaks at more than **$5.80/gal in April** and averages **$4.80/gal** for the year. (EIA STEO, April 2026)

**U.S. crude oil production:** Forecast at **13.5 million b/d in 2026** (down from 13.6 mbd in 2025), recovering to 13.8 mbd in 2027. (EIA STEO, April 2026)

**U.S. LNG exports:** Expected to rise from **15 Bcf/d (2025)** → **17 Bcf/d (2026)** → **19 Bcf/d (2027)**. In March 2026, exports were close to record levels at nearly **18 Bcf/d**. (EIA STEO, April 2026)

**Henry Hub natural gas price:** Forecast at **$3.67/MMBtu in 2026** (up from $3.53 in 2025), falling to $3.59 in 2027. (EIA STEO, April 2026)

**Natural gas storage:** Withdrew the 2025–2026 season (Nov–March) ending **3% above the five-year average** at just over **1,900 Bcf**. Expected to end October 2026 at **4,015 Bcf**, 6% above the five-year average. (EIA STEO, April 2026)

**WTI/Brent spread context:** The Brent-WTI spread reflects global disruption dynamics. EIA characterizes fuel prices as "highly contingent" on three variables: (1) duration of closure, (2) production outage estimates, (3) reopening restoration timeline. (EIA Administrator Tristan Abbey quote, April 2026)

**Diesel inventories:** U.S. diesel inventories remain **below the five-year (2021–2025) average**, contributing to elevated diesel prices. (EIA STEO, April 2026)

**LNG spread dynamics:** Reduction in Hormuz LNG flows has "sharply increased the spread" between Henry Hub spot prices and European/Asian import prices. U.S. export facilities running at near-peak capacity with "very limited flexibility" to increase exports. (EIA STEO, April 2026)

Entities Mentioned

**Organizations:** U.S. Energy Information Administration (EIA), International Energy Agency (IEA) — mentioned as potential response body
**Places/Countries:** Saudi Arabia, Iraq, Kuwait, UAE, Qatar, Bahrain, United States (as importer/exporter)
**Ports/Facilities:** Henry Hub (U.S. LNG benchmark), Ras Tanura (Saudi Arabia — largest marine export terminal, shut after drone strike per Reuters)
**Numbers:** 7.5 mbd (March shut-in), 9.1 mbd (April shut-in), 6.7 mbd (May projected), $115/b (Q2 peak Brent), $103/b (March Brent average), $4.30/gal (April gasoline peak), $5.80/gal (April diesel peak), 15/17/19 Bcf/d (LNG exports 2025/26/27), 1,900 Bcf (storage end-winter), 4,015 Bcf (storage end-October)

Relevance to Q1/Q2/Q3

**Q1 (Hormuz closure extent):** High relevance — quantifies 9.1 mbd production shut-in for April, documents near-complete cessation of Hormuz transit
**Q2 (Price impact):** High relevance — provides central case price forecasts ($115/b Brent peak, $4.30/gal gasoline, $5.80/gal diesel) with explicit risk-premium framing
**Q3 (Europe gas/security):** Medium relevance — documents global LNG supply reduction and spread widening between Henry Hub and European/Asian prices; U.S. gas storage data relevant to Europe's LNG-sourcing environment

Quotes

"Our petroleum forecasts are highly contingent on the interaction of three variables. First, to even run our model we have to make an assumption about the duration of the Strait of Hormuz closure. Second, we know that the closure is forcing production to shut in, but we can only estimate these outages. Third, just as we had never before seen the strait close, we've never seen it reopen. What exactly that looks like remains to be seen. Full restoration of flows will take months." — EIA Administrator Tristan Abbey, April 7, 2026

"The reduction in flows of liquefied natural gas (LNG) exports through the Strait of Hormuz has reduced global LNG supply and sharply increased the spread between the U.S. benchmark Henry Hub spot price and European and Asian import prices." — EIA STEO, April 2026