Analysts Forecast Average Price of Brent Crude in 2019
The average price of Brent Crude will be between US$70 and US$80 per barrel in 2019, according to a new Rigzone poll.
Forty-percent of the 231 poll respondents said the average price would fall within this range next year, with 23 percent stating that the average price would be between US$80 and US$90 per barrel.
An identical percentage thought the average price would be below US$70 per barrel and the remaining 14 percent of voters said the average price of Brent Crude would be above US$90 per barrel in 2019.
Fitch Solutions Macro Research is forecasting the average price of Brent Crude to be US$82 per barrel next year, according to a report from the company dated the 14th August.
The report highlighted that the Bloomberg Consensus forecasted an average Brent Crude price of US$69.50 per barrel in 2019.
Looking further ahead, Fitch Solutions Macro Research forecast that the average price of Brent will be US$85 per barrel in 2020, US$89 per barrel in 2021 and US$91 per barrel in 2022.
“In the short term, prices will struggle for direction, as uncertainty around both the impact on supply from the Iranian sanctions and escalating trade tensions between the US and China persists,” oil and gas analysts at Fitch Solutions Macro Research said in the report.
“Returning OPEC+ barrels and strong US onshore production will offset output losses in Iran, Venezuela and Angola. However, global spare capacity will shrink substantially as a result,” the analysts added.
“Beyond this, a thinning global projects pipeline and the aforementioned decline in global spare capacity imply limited slack in the market from 2019 onwards and will expose oil prices to greater volatility and greater upside,” the analysts continued.
From 2019, the analysts said they expect prices to “increase robustly, with a healthy global demand growth outlook outpacing supply growth, which will continue to experience constraints due to Iranian sanctions, limited new project start-ups and decline rates in Asia-Pacific, SSA and Europe.”
Exploring theoretical alternative medium-term scenarios, the analysts said, “a greater-than-expected impact on Iranian crude exports and weakness in US production growth would add upside to Brent.”
“Alternatively, demand side weakness stemming from escalating global trade risk and EM subsidy reforms would limit price appreciation,” the analysts said in the report.
The Bloomberg Consensus forecasted an average Brent Crude price of US$69.70 per barrel in 2020, US$68.30 per barrel in 2021 and US$65.20 per barrel in 2022, according to the report.
Source: Rigzone