Oil Price Forecasts
As the energy industry approaches 2018, oil analysts have raised their forecasts for the crude price next year after OPEC and and non-OPEC producers, led by Russia agreed to extend output cut by 1.8 million barrels per day (bpd) until the end of 2018 to end persistent oversupply.
Analysts and economists polled by Reuters, forecast U.S. crude futures CLc1 would average $54.78 per barrel in 2018. The North Sea benchmark, is expected to average $54.19 per barrel in 2017. Benchmark Brent crude futures LCOc1 are now forecast to average $58.84 in 2018. Oil prices have rallied strongly in the second half of this year, on a growing belief that the OPEC-led output cuts, coupled with strong consumption, were bringing the market back into balance.
Political tensions in Saudi Arabia, production disruptions in Libya and Nigeria and economic depression in Venezuela that has cut crude output will also support oil prices. Asia will be a key driver of global demand growth, helping to tighten the balance between supply and consumption. The biggest increase in exports to Asia has been coming from the United States, partly stimulated by a reduction in export volumes from the Middle East. China and India will lead the non-OECD oil demand growth in 2018.