Fitch Solutions Maintains Oil Price Forecast

Fitch Solutions Maintains Oil Price Forecast
Fitch Solutions has maintained its Brent oil price forecast to 2024.

Fitch Solutions has maintained its Brent oil price forecast to 2024, the company’s latest oil price outlook report has revealed.

Analysts at the company expect Brent to average $44 per barrel in 2020, $51 per barrel in 2021, $53 per barrel in 2022, $55 per barrel in 2023 and $58 per barrel in 2024. The forecast is the same as Fitch Solutions’ September oil price outlook.

“We maintain our forecast for Brent this month, at an annual average of $44 per barrel in 2020, rising to a $51 per barrel average in 2021,” Fitch Solutions analysts stated in the report, which was sent to Rigzone on October 2.

“The rebalancing of global oil supply and demand remains on track, with OPEC+ production cuts holding excess barrels off the market and the global economic recovery spurring renewed fuel demand. However, mixed signals across the market offer little conviction for a sustained rally or a sharp correction in prices,” the analysts added in the report.

“This has resulted in us holding a neutral outlook heading into the end of the year. The high level of uncertainty for oil demand and the upcoming U.S. elections pose a myriad of complex risks for oil prices, which are skewed to the downside. This contrasts with the strong recovery in China and increasing fuel consumption in key markets, which build a good case for a more optimistic outlook for oil prices,” the analysts continued.

In the report, the analysts went on to note that OPEC messaging indicates a sharp supply side response if needed to support prices, which they said could help mitigate some of the downside risks. They added, however, that the implementation of such action would be challenging.

The analysts also outlined that a global vaccine program by mid-year 2021 would support renewed global growth of 4.4 percent and its bullish price forecast for 2021 and highlighted that Libya’s production revival may only be short-lived given the recent history and continued conflict on the ground.

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