Experts Predict Brent Trends in 2018: A Wrap Up
The average price of Brent crude oil will remain below $70 per barrel in 2018, Rigzone reported, quoting several oil and gas experts.
Analysts at BMI Research expect the commodity to average $65 per barrel this year, with experts at investment banking firm Jefferies forecasting average prices of $63 per barrel.
Michael Burns, oil and gas partner at law firm Ashurst, suggests that the oil price will hover around the mid-$60 per barrel mark in 2018, Interfax Energy anticipates Brent to average $61 per barrel throughout the year, and a recent Gulf Intelligence (GI) survey polling 100 energy industry executives also highlighted that Brent would stay in the $60s region.
Geopolitical tensions in the Middle East, together with Venezuela’s deteriorating macroeconomic situation, are expected to be the main bullish factors affecting oil prices in 2018, according to Abhishek Kumar, senior energy and modelling analyst at Interfax.
“Ongoing protests in Iran, tussles within the Royal Family of Saudi Arabia, Houthis fighters threatening to disrupt traffic through the Bab-elMandeb strait, as well as the situation in Libya, Syria and Lebanon are all examples of geopolitical tensions in the Middle East,” Kumar noted.
The majority of those that took part in GI’s survey supported Kumar’s view, stating that geopolitics, including the threat of war in the Middle East, would replace OPEC output cuts as the biggest oil price driver this year.
As for the predominant bearish factor on oil prices in 2018, Kumar revealed the culprit will be rising oil output in the United States. Analysts at Jefferies backed up this claim, describing U.S. production growth as a great risk to oil prices over the next 12 months.
Contrastingly, analysts at GMP FirstEnergy suggested that this year’s U.S. supply growth won’t seriously hold back the value of Brent crude.