Analysts Expect Oil Prices to Remain Close to $80 This Year

Sufficient supply and uninterrupted oil trade flows despite the Middle Eastern conflicts are set to keep oil prices close to the $80 per barrel threshold this year, the monthly Reuters poll of analysts showed on Thursday.

For the fourth consecutive month, more than three dozen analysts and economists continued to revise down slightly their forecast for the average price of the two most traded benchmarks, Brent and WTI, the Reuters poll found.

According to the experts, Brent Crude prices will average $81.13 a barrel this year, a slight downgrade from the $81.44 a barrel average consensus in the January poll.  

For WTI Crude, the surveyed analysts expect an average price of $76.54 per barrel in 2024, down from $77.26 a barrel expected in last month's poll.

Early on Thursday, both benchmarks were set to post their second monthly gain in a row after a period of losses last year, with traders anticipating an extension of the OPEC+ production cuts.

An extension would contribute to a perception of a tightening oil market that has served to keep oil prices elevated for most of the past two months.

As of 7:45 a.m. EST on Thursday, Brent prices were slightly down by 0.13% at $83.62, while the U.S. benchmark, WTI Crude, traded 0.17% higher at $78.65.

Earlier this week, Goldman Sachs revised up its forecast for summer peak Brent Crude prices to $87 per barrel, up by $2 from earlier expectations, on the back of faster-than-expected land inventory drawdowns due to seaborne trade disruptions from the Red Sea crisis.

According to Goldman, Brent prices will likely remain in the $70-$90 a barrel trading range in the near term amid a modest geopolitical premium from the wars in Ukraine and the Middle East.

The Wall Street bank expects the OPEC+ alliance to decide in early March to roll over the first-quarter cuts into the second quarter, and only gradually to unwind the supply reductions beginning in the third quarter of this year.

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:

• Surprise Crude Build Weighs on Oil
• New Expansion Project Could Give Qatar 25% Share of Global LNG Supply
• Pakistan Considers Iran Gas Pipeline Restart Despite U.S. Sanctions