EIA Cuts 2020 Oil Price Forecast



EIA Cuts 2020 Oil Price Forecast
The U.S. Energy Information Administration has cut its Brent oil price forecast for 2020.

The U.S. Energy Information Administration (EIA) has cut its Brent oil price forecast for 2020, its February short-term energy outlook (STEO) report has revealed.

The EIA’s Brent spot average forecast for 2020 is now $61.25 per barrel. This marks a notable drop from the 2020 Brent spot average forecast posted in its January STEO, which stood at $64.83 per barrel.

In its February STEO, the EIA’s quarterly Brent spot average forecast for the year is as follows:

  • First quarter - $58.59 per barrel
  • Second quarter - $57.69 per barrel
  • Third quarter - $63.62 per barrel
  • Fourth quarter - $65.00 per barrel

The EIA’s quarterly Brent spot average forecast in its January STEO read as follows:

  • First quarter - $65.98 per barrel
  • Second quarter - $63.38 per barrel
  • Third quarter - $65.00 per barrel
  • Fourth quarter - $65.00 per barrel

The EIA now expects global petroleum and liquid fuels demand will rise by 1 million barrels per day in 2020, its February STEO showed. In its January STEO, this demand was forecasted to increase by 1.3 million barrels per day in 2020.

In 2021, the Brent spot average was forecasted to hit $67.53 per barrel in both the January and February EIA STEOs.

Earlier this month, Fitch Solutions Macro Research (FSMR) also revised down its Brent oil price forecast for 2020. FSMR now sees Brent averaging $62 per barrel this year, which marks a $3 drop compared to its previous forecast in January.

On Tuesday, Rystad Energy revealed that it had slashed its global oil demand growth forecast for 2020 by 25 percent. The company now sees demand growing by 820,000 bpd this year, compared to its previous forecast of 1.1. million bpd, which was published in December. Rystad warned, however, that its worst-case scenario sees growth plunging to 650,000 bpd year on year.

To contact the author, email andreas.exarheas@rigzone.com



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