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EIA decreases forecast for oil prices

12 July 2017 [11:55] - TODAY.AZ

By  Trend


Average price for Brent oil will be $50.79 per barrel in 2017 and $51.58 per barrel in 2018, according to the US Energy Information Administration’s (EIA) forecasts in its July 2017 Short-term Energy Outlook.

In its June 2017 Short-term Energy Outlook, the EIA forecast the Brent crude oil price at $52.69 per barrel in 2017 and at $55.61 per barrel in 2018.

West Texas Intermediate (WTI) oil prices are forecast at $48.95 per barrel in 2017 and $49.58 per barrel in 2018, according to the EIA. Meanwhile in its previous Short-term Energy Outlook EIA forecast WTI oil prices at $50.78 per barrel in 2017 and $53.61 per barrel in 2018.

EIA expects that some upward price pressures could emerge in the second half of 2018 if global oil inventories decline during that period and if the market expects global oil inventory withdrawals heading into 2019. EIA forecasts Brent crude oil prices to average $53 per barrel during the second half of 2018, with prices rising to $55 per barrel by the end of 2018.

The prices for Brent and WTI stood at $43.74 per barrel and $43.33 per barrel, respectively, in 2016, said the EIA.

The EIA noted that monthly average spot price of Brent crude oil decreased by $4 per barrel in June to $46 per barrel, marking the first month of 2017 in which Brent crude oil spot prices averaged below $50 per barrel.

The return of 0.1 million barrel per day of combined crude oil production in Libya and Nigeria contributed to lower oil prices in June, as did builds in total US crude oil and petroleum products inventories that were above the five-year average during the weeks ending June 2 and June 9.

Also, Brent crude oil spot prices declined by nearly 5 percent in late May following the news of the OPEC agreement that extended production cuts through the first quarter of 2018, as some market participants had anticipated more aggressive cuts.

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