The government’s oil forecasters raised their number by $14 a barrel. In its Short-Term Energy Outlook, released Oct. 6, the U.S. Energy Information Administration, part of the Energy Department, expects Brent crude to average $105 a barrel in the fourth quarter of 2026. That is $14 higher than last month’s outlook, which by that math had Brent near $91.
Why the forecast went up
The outlook rests on an assumption about the Middle East. EIA says it expects “oil flows from the Middle East will remain constrained through the fourth quarter of 2026.” It also assumes that convoys through the Strait of Hormuz and workarounds such as bypass routes and ship-to-ship transfers will gradually raise production and exports over the rest of the forecast period.
Brent is the international benchmark for crude, and a barrel holds 42 gallons. EIA completed the forecast on Oct. 1 and published it Oct. 6.
Heating bills this winter
The outlook breaks winter costs down by how a home is heated. Homes that use natural gas or propane for their main heat are expected to spend less than they did last winter. Homes that heat with electricity are expected to spend slightly more.
Heating oil is the hardest hit. EIA says about 3 percent of U.S. households use it, mostly in the Northeast, and their prices are “up more than 30%” from last winter. Spending is still forecast to rise 21 percent for those households, because a milder Northeast winter is expected to offset part of the price jump.
For a retiree on a fixed income who drives and heats a home, the question is which of those buckets applies and how much a $105 barrel adds to the winter’s bills.
A forecast of $105 Brent and a 21 percent jump for heating-oil homes puts pressure on winter budgets, even though other households may spend less. The Benefits Checklist lays out 11 benefit programs and the 2026 income limits, including help with heating costs.
Check heating-bill help among 11 benefit programs in The Benefits Checklist →
What it says about the pump
The same release gives gasoline numbers. Regular gasoline averaged $4.35 a gallon in September, according to the outlook. EIA’s table has a 2026 average of $3.91 a gallon and a 2027 average of $3.56, and its text says gasoline should average “just under $3.60” next year.
Those annual averages blend all twelve months of a year, so $3.91 does not mean pump prices are about to fall to that level. The more telling comparison is September’s $4.35 against the $3.56 forecast for next year, a drop of 79 cents that depends on the Middle East assumption holding.
What a forecast can and cannot do
A forecast is a projection built on stated assumptions, and EIA names its main one plainly. EIA ties its fourth-quarter numbers to that assumption about Middle East flows. The agency revises the outlook every month, and this month’s revision was upward by $14. Last month’s estimate works out to about $91 a barrel, so the new number is roughly 15 percent higher.
Brent is also not the price at the pump. Crude is one part of a gallon’s cost, alongside refining, distribution and taxes, and some states have cut their own fuel taxes this month. EIA’s weekly survey for the week of Oct. 5 had U.S. regular at $4.354 and diesel at $6.199, with regular down 11.1 cents on the week.
Diesel next year
The outlook’s diesel table shows retail diesel averaging $5.19 a gallon in 2026 and $4.49 in 2027. The text says “about $4.50” next year. Diesel runs the delivery trucks that stock grocery shelves, so the 2027 forecast matters to households that never buy a gallon of it.
Following the oil forecast through winter
The Short-Term Energy Outlook comes out monthly, and the next edition will show whether the $105 estimate holds, rises or falls back. The EIA page is free to read and has the full tables, including the regional heating numbers for each type of home.
A household can use the numbers by sorting itself into one of the buckets: gas or propane heat, electric heat, or heating oil. Then it can check last winter’s bills against the direction EIA gives for that group. A heating-oil customer who pays by the delivery, mostly in the Northeast, should compare per-gallon prices from several suppliers.
For driving, the weekly pump survey is the quicker signal than the crude forecast, since it shows what stations are charging this week.
A $105 barrel and a 21 percent heating-oil jump
Heating bills and pump prices are the two costs this forecast touches, and both land on fixed incomes in the same months. The Benefits Checklist covers 11 benefit programs, among them heating and cooling help, with the 2026 income limits and a 50-state phone directory.
Get the heating-help programs and income limits in The Benefits Checklist →
This article was produced with AI assistance and edited for accuracy against the sources linked above.
