Brent Crude prices will average in the $60s per barrel this year, the majority of industry experts said in a poll carried out by Gulf Intelligence at the recent IP Week oil conference.
A total of 53 percent of respondents see Brent Crude averaging in the $60s—the price at which the international benchmark has been holding for most of the past two months. A third of survey respondents are more bullish on oil prices, with 33 percent expecting Brent to average in the $70s in 2019. Just eight percent forecast the average Brent price in the $50s, five percent see it in the $80s or above, and only one percent in the $40s or lower.
Last year, Brent Crude averaged $71.34 a barrel, up from $54.71 in 2017.
Asked about the OPEC and allies’ compliance with the 1.2 million bpd production cut between January and June, most industry respondents expect very high compliance from the OPEC+ group. A total of 30 percent of expect compliance to be 90 percent, another 29 percent see it at 100 percent, 22 percent expect 120-percent compliance, while 18 percent forecast compliance at 80 percent or below. Related: Could This NASA Innovation Save The EV Industry?
Putting aside OPEC+ oil production cuts, respondents were also asked to pick the industry development which should be most closely watched for direction of the oil prices this year—U.S. shale production growth was the most cited factor to watch, with 34 percent of respondents pointing at it, followed by 30 percent who will be most closely watching the U.S.-China trade war, and 23 percent saying we should watch how the U.S. would proceed with the sanction waivers for Iran’s oil customers when they expire in early May.
Industry experts were almost equally split on the question should OPEC change its current strategy to pursue higher oil prices and fight for market share instead. Still, 54 percent said that OPEC should continue to prioritize higher oil prices, even if those higher prices help U.S. shale producers.
Focusing on Q1 2019, Gulf Intelligence’s Energy Market Survey in February showed that 69 percent of respondents expected U.S. sanctions on Venezuela’s oil exports to push Brent Crude up to $70 a barrel this quarter.
By Tsvetana Paraskova for Oilprice.com
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