Brent oil prices will drop to $50 per barrel by late 2019, Trend reports citing the UK-based Capital Economics consulting company.
"Our forecast for global GDP is pointing to lower growth in oil consumption this year. As a result, the market is likely to return to a surplus in the second half this year, with a consequent fall in price. Our forecast is for the price of Brent to fall to $50 per barrel by end-2019," said the report.
Meanwhile, Capital Economics expects the Brent-WTI spread to narrow from recent highs as logistical bottlenecks in the US are resolved and more WTI can be exported. "Our forecast is for WTI to stand at $45 per barrel at end-2019."
"Our analysis suggests that OPEC’s restraint will put a floor under prices in the first half of the year. But we expect demand to soften later in 2019 as the US economy slows. Given that US oil supply is likely to remain high, we think this will return the market to a comfortable surplus by end-year."
The outlook for 2020 is somewhat brighter, according to the report.
"China’s economy is likely to have stabilised, owing to policy stimulus, and the Fed will be cutting interest rates which bodes well for US oil demand. What’s more, the expected fall in the oil price in 2019 should curb supply growth. We forecast that the price of Brent will drop to $50 per barrel by end-2019, before rising to $60 by end-2020."
As for 2025, the company forecasts Brent and WTI prices to stand at $70 per barrel each.
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