Energy Industry Struggles to Price Oil in Geopolitical Landscape

IE Week 2026 consensus ignores key factors like US-China rivalry and AI-driven power demand surge

Published on Feb. 11, 2026

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At the annual IE Week conference in London, energy executives are forecasting Brent crude oil prices in the $55-65 range through 2026. However, the analysis fails to account for two major forces shaping energy markets: the geopolitical rivalry between the US and China, and the impact of AI-driven growth in data center electricity demand that is shifting the focus from crude oil to natural gas. The industry is pricing the commodity inventory, but neglecting to price the broader system dynamics.

Why it matters

The consensus oil price forecast ignores the complex geopolitical chessboard linking sanctioned barrels from Iran, Venezuela, and Russia, as well as the structural shift in energy demand driven by the rapid growth of data centers and AI infrastructure. These factors could significantly impact oil and gas markets in ways that a simple supply-demand analysis cannot capture.

The details

The bearish case for lower oil prices is based on rising global inventories and growing supply from the US, Brazil, and Guyana. However, the report notes that the sanctions regimes on Iran, Venezuela, and Russia are interconnected and will be subject to negotiations between the US and China, not just isolated supply-demand dynamics. Additionally, the surge in electricity demand from data centers and AI infrastructure is driving a parallel revenue architecture for Gulf states to expand natural gas production, which could decouple their fiscal trajectories from crude oil prices.

  • Six days ago, Presidents Trump and Xi held a 'long and thorough' conversation ahead of Trump's planned April visit to Beijing to discuss issues like oil and gas purchases and sanctions enforcement.
  • In January 2026, Venezuelan oil shipments to China fell to zero after a US naval crackdown, and Trump has threatened 25% tariffs on any country buying Iranian oil.
  • The Busan summit in October 2025 produced a temporary truce between the US and China, but Brookings called the détente 'likely to be a fleeting one'.

The players

Fatih Birol

Executive Director of the International Energy Agency (IEA), who addressed the IE Week conference.

Donald Trump

Former US President, who is planning an April 2026 visit to Beijing to discuss issues like oil and gas purchases and sanctions enforcement with Chinese President Xi Jinping.

Xi Jinping

President of China, who held a 'long and thorough' conversation with former US President Trump ahead of Trump's planned April 2026 visit to Beijing.

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What they’re saying

“Very, very few people on any of the stages were willing to put their necks out. Too much if and when and maybe but.”

— Sean Evers, of Gulf Intelligence

What’s next

The outcome of the planned April 2026 meeting between former US President Trump and Chinese President Xi Jinping will be critical in determining whether sanctioned barrels from Iran, Venezuela, and Russia will be able to reach Chinese refineries in the second half of 2026, which could significantly impact global oil prices.

The takeaway

The energy industry's consensus price forecast for Brent crude oil ignores the complex geopolitical dynamics and structural shifts in energy demand driven by the growth of data centers and AI infrastructure. Boards and executives need to look beyond simple supply-demand models and price the broader systemic risks and uncertainties shaping the future of the energy sector.