2 contracts that could hold the Orioles back in 2026 and beyond

As the Baltimore Orioles turn the page on a disappointing 2025 campaign and regroup to return to contention in 2026, a quick look at their books shows they're in pretty good shape to make splashes in free agency to complement their budding young core of hitters.

Pitching will be the top priority, though it remains to be seen if Mike Elias will follow through on his promise and actually commit the big dollars needed to secure frontline arms.

The club has a lot of money coming off its books. Their 2025 payroll finished at $159.5 million, yet as it stands now, with arbitration estimates factored in, they are currently projected to have just $101.7 million on the books for 2026.

The blessing of having most of the roster in either their arb or pre-arb years means that Baltimore has a lot of flexibility, but the two long-term deals they do have on the books could hamper that somewhat, though one looks worse than the other.

Note: Contracts can have variable salaries from year to year. The average annual value is what is used to calculate the impact on the luxury tax, so for remaining contract numbers, the AAV per season will be listed alongside the total value remaining on the deal.

These two contracts threaten to hold the Orioles back in 2026 and beyond

Outfielder Tyler O'Neill - three years $49.5 million

Remaining: two years, $33 million - $16.5 million per season

Chalk up Tyler O'Neill's deal in the "aged like milk" column. A year after he crushed 31 dingers with a .241/.336/.511 line for the rival Boston Red Sox, he hit just .199/.292/.292 for Baltimore. Ouch.

In hindsight, Baltimore should have known that counting on O'Neill to replace the departing Anthony Santander's power bat in the lineup was a risky proposition. First, O'Neill came to Baltimore with a lengthy injury history, which again reared its head with the Birds as a variety of ailments limited him to just 54 games.

The second red flag was the inconsistency with the bat. O'Neill's line in Boston was good for a 133 wRC+, which was actually a hair better than the 128 mark Santander posted back in 2024. Zooming out, though, O'Neill was coming off two years in which he had wRC+ marks of 99 (2022) and 97 (2023), meaning he was essentially a touch below average. Signing him was pretty much a roll of the dice.

That dice roll came up snake-eyes. The O's tried to protect themselves by giving O'Neill an opt-out after the 2025 season, which means if he did have a good year, they'd likely lose him this winter. Given how he performed, there's no way he's beating the $33 million he's owed on the open market, meaning the club is now stuck with him through 2027.

Catcher Samuel Basallo - eight years $67 million

Remaining: eight years, $67 million - $8.375 million per year

First, some housekeeping. After signing his massive eight-year, $67 million extension, Samuel Basallo will only make $1.625 million in cash per season for the next three years. Despite this, the average annual value is what counts towards the luxury tax, meaning that the charge will actually be $8.375 million. That's roughly 10 times what Basallo's actual pre-arb salaries would be if not for the extension.

If he develops into the star they hope he can be, this will turn out to be a massive bargain. However, it's also a huge risk. The 21-year-old hit just .165/.229/.330 with 4 homers in 31 games, giving credence to the idea that this move was premature.

If the Orioles are to be believed and aren't actually shopping Adley Rutschman, that means between the two players, they'll have over $15 million committed to the catcher position in 2026 and even more in 2027, negating the value of having these talented but struggling backstops under team control.

Long-term extensions for prospects just breaking in have become en vogue, but it doesn't come without risk, and by doing this now, the Orioles have ratcheted up the pressure on Basallo to reach his ceiling and to do so quickly.

Between this deal and Tyler O'Neill's contract, nearly a quarter of Baltimore's payroll obligations entering the offseason are tied up in these two players. That doesn't seem to be a wise use of resources, so while they have plenty of wiggle room, they could have had even more.