The U.S. Energy Information Administration (EIA) has raised its oil price forecasts. For 2020 and beyond, its latest short term energy outlook (STEO) report has revealed.
The EIA now expects the Brent cash price to average $38.02 per barrel this year and $47.88 per barrel in 2021. Consistent with its June STEO. Back within the EIA’s May STEO. This year and $47.81 per barrel next year.
West Texas Intermediate (WTI) spot prices
West Texas Intermediate (WTI) spot prices are expected to average $35.14 per barrel. In 2020 and $43.88 per barrel in 2021. The EIA’s June STEO shows. These prices were forecasted as well as to average $30.10 per barrel. This year and $43.31 per barrel next year. Within the EIA’s previous STEO.
“The forecast of rising petroleum prices reflects expected declines as well as in global oil inventories. During the last half of 2020 and thru 2021,” the EIA stated in its June STEO.
The EIA is that the statistical and analytical agency within the U.S. Department of Energy. It collects, analyzes, and disseminates independent and impartial energy information,
“EIA expects high inventory levels and spare petroleum production capacity will limit upward price pressures within the coming months, but as inventories decline into 2021, those upward price pressures will increase,” the EIA added.
The EIA now expects global oil inventories will begin declining as well as in June. A month before previously forecasted. The earlier than expected draws are the results of sharper declines. In global boring during June and better global oil demand than previously expected, consistent with the EIA.
Global oil inventories as well as at the top of May stood 1.4 billion barrels. Above they were at the top of 2019, the EIA estimates.
While lockdowns have been relaxed in parts of the U.S., lifting consumption from its lows, there are still concerns that the second wave of infections and rise of drilling could derail any rebound and expectations of inventory draws.