Traders see oil at $65-$100 a barrel next year

The world’s biggest trading houses said on Wednesday they saw oil prices not falling below $65 per barrel and possibly breaking above $100 next year as US sanctions on Iran reduce crude exports from the Islamic republic.

Oil has rallied this year on expectations the sanctions, coming into force on Nov 4, will test the ability of the Organization of the Petroleum Exporting Countries (OPEC) and others to fill the supply gap as shipments from OPEC member Iran decline.

Brent crude last week reached $86.74 a barrel, the highest since 2014.

But in 2019, forecasters such as the International Energy Agency say emerging-market crises and trade disputes could dent global demand while rising non-OPEC production adds to supply.

Jeremy Weir, chief executive of Trafigura, said at the Oil & Money conference in London that he would not be surprised to see oil trade at more than $100 per barrel next year.

Alex Beard, chief executive for oil and gas at Glencore, said at the same event that he forecast a mid-term oil price of $85-90, as a release of US strategic oil stocks looked remote and would have limited impact anyway.

“I think the sanctions will be very tough. Waivers will be extremely limited if any and I don’t see an end to it as the objective is regime change in 2019. I can’t see anything that will affect oil prices dramatically to the downside,” Beard said. (RTRS)