The US Energy Information Administration (EIA) has revealed its latest Brent oil price forecast in the February edition of its Short-Term Energy Outlook (STEO), which was released on Tuesday afternoon.
According to the STEO, the EIA sees spot Brent averaging $83.63 per barrel in 2023 and $77.57 per barrel in 2024. In its previous STEO, which was released in January, the EIA projected that the Brent spot price would average $83.10 per barrel. barrel in 2023 and $77.57 per barrel in 2024.
“Last month we highlighted oil demand in China and oil production in Russia as two of the main uncertainties in the oil market this year, and we revised our outlook for both in the forecast this month,” the EIA stated in its latest STEO.
“The revisions are a result of the relaxation of Covid restrictions in China, which have boosted our forecast for oil demand growth. At the same time, more oil was produced in Russia than we had expected during January , and we raised our forecast for Russian oil production through the end of 2024. We also lowered our forecast for OPEC oil production due to rising global oil inventories.”, the EIA added.
“These changes have been largely offset in our global forecast balances, and beyond the first quarter of 2023, we have left our crude oil price forecast largely unchanged from last month’s outlook,” the EIA continued.
In its February STEO, the EIA noted that it expected the Brent spot price to average $85 per barrel in the first half of 2023 and $82 per barrel in the second half of the year. The spot price of Brent crude averaged $82 a barrel in January, the STEO noted, adding that it was about $2 a barrel higher than the December 2022 average.
“Oil prices rose during January in part due to the expectation of increased demand for oil as a result of the relaxation of Covid-19 restrictions and increased mobility in China” , stated the February STEO.
“Perceptions of a less severe recession and some improvement in macroeconomic conditions also likely contributed to the increase in crude oil prices over the past month,” the STEO added.
Standard Chartered, Fitch Solutions, current price
A Standard Chartered commodities roadmap report sent to Rigzone on February 7 showed the company projected Brent to reach $91 a barrel in 2023, $98 a barrel in 2024 and $109 a barrel in 2025 .barrel in the second quarter of this year, $88 per barrel in the third quarter and $93 per barrel in the fourth quarter.
According to the report, Standard Chartered expects the price of Brent to rise to $92 per barrel in the first quarter of 2024 and $94 per barrel in the second quarter of next year.
In a separate report recently submitted to Rigzone, Fitch Solutions Country Risk & Industry Research projected that Brent crude would average $95 per barrel in 2023, $88 per barrel in both 2024 and 2025, and $85 per barrel in 2026 and 2027. The price projections for 2026 remain unchanged from a previous Fitch Solutions oil price outlook report sent to Rigzone in early December 2022, which had no price projections for the 2027.
At the time of writing, Brent is trading at $84.60 a barrel. The commodity fell from a settlement of $87.47 a barrel on January 26 to a close of $79.94 a barrel on February 3, before closing as high as $83.69 a barrel on February 7.
Oil topped $100 a barrel for the first time in years in February 2022 as Russian forces escalated a conflict with Ukraine. The price of Brent closed above $120 a barrel on several occasions last year, the last of which came in June 2022.
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