EIA Raises Oil Price Forecast | Rigzone
The U.S. Energy Information Administration (EIA) has raised its oil price forecast for 2020 and beyond, its latest Short-Term Energy Outlook (STEO) report has revealed.
The EIA now expects the Brent spot price to average $38.02 per barrel this year and $47.88 per barrel in 2021, according to its June STEO. In the EIA’s May STEO, the Brent spot price was expected to average $34.13 per barrel this year and $47.81 per barrel next year.
West Texas Intermediate (WTI) spot prices are expected to average $35.14 per barrel in 2020 and $43.88 per barrel in 2021, according to the EIA’s June STEO. These prices were forecast to average $30.10 per barrel this year and $43.31 per barrel next year in the previous EIA STEO.
“The forecast for higher crude oil prices reflects expected declines in global oil inventories through the second half of 2020 and into 2021,” the EIA said in its June STEO, which was released on Tuesday.
“The EIA expects high inventory levels and unused crude oil production capacity to limit upward pressure on prices in the months ahead, but as inventories decline through 2021 , these upward pressures on prices will increase,” the EIA added.
The EIA now expects global oil inventories to start falling in June, a month earlier than expected. The earlier-than-expected drawdowns are the result of steeper declines in global oil production in June and stronger-than-expected global oil demand, according to the EIA.
Global oil inventories at the end of May stood 1.4 billion barrels higher than they were at the end of 2019, the EIA estimates.
The EIA is the statistical and analytical agency of the US Department of Energy. It collects, analyzes and disseminates independent and unbiased energy information, according to its website.
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