A barrel of oil will rise in price by $5 each year and reach $60 by 2021, OPEC forecasts
Almaty. November 9. Silkroadnews – According to OPEC’s new outlook, starting from 2016 the crude price will only rise by $5 each year and reach $60 per barrel by 2021 (level for the crude market crisis of 2009), RBC says.
“By the beginning of the next decade, OPEC crude will be worth $60 per barrel. In this case, oil prices will recover to the level of 2009 crisis year”, the publication says with reference to the organization’s annual forecast.
In 2016 the average price of OPEC crude “basket” will stay at $40 per barrel and rise by $5 per year until 2021.
Thus, in 2021 the OPEC oil price will reach $65 per barrel, which corresponds to $60 in 2015 prices.
OPEC expects the market to get stabilized: global demand for crude will grow (according to the new forecast of the cartel, by 2021 demand for oil will grow by 6.2 million barrels per day to 99.2 million barrels), production in non-OPEC countries will get reduced, and the rates of its recovery will be lower than it was expected previously. This, in turn, will reduce the crude excess at the market and commercial crude stockpiles. Though extraction level by non-OPEC countries is expected to grow since 2018, low costs of exploration and development of new fields in previous years will be a production deterrent.
Earlier OPEC expected crude prices to reach a nominal level of $80 by 2020.
According to OPEC experts’ forecasts, in the coming years we should expect an increase in shale oil production. The cartel’s projection say shale oil daily output will reach 4.55 million barrels by 2020, and 6.73 million barrels by 2030 (in its last year’s forecast the cartel projected 5.19 million and 5.61 million barrels respectively).
In its new forecast, OPEC notes oil demand growth and in the longer term expects the demand to grow by 15% to 109.4 million barrels per day by 2040. Demand growth will be mainly provided by emerging economies. In particular, demand for oil in India in 2021 is expected to grow 32% (to 5.4 million barrels per day).
