Crude oil price forecast to fall in the first half of 2020

TBILISI(BPI)- The Energy Information Administration forecasts Brent crude oil spot price will average $65 per barrel in 2020 and $68 per barrel in 2021

The price of crude oil is forecast to fall in the first half of this year, according to a new report.

The US Energy Information Administration (EIA) forecasts Brent crude oil spot price will average $65 (£50) per barrel (b) in 2020 and $68 (£52)/b in 2021.

The West Texas Intermediate (WTI) spot is expected to average $59 (£45)/b in 2020 and $62 (£47)/b in 2021.

Monthly average Brent prices rose from $63 (£48)/b in September to $67 (£51)/b in December last year.

The report states: “EIA expects that crude oil prices will remain elevated in the first few months of 2020, reflecting a price premium on crude oil from recent geopolitical events. However, this price premium will diminish in the first half of 2020 and market fundamentals will drive the crude oil price forecast in the second half of 2020 and in 2021.”

Some of the geopolitical events include attacks on oil tankers transiting the Persian Gulf and the Red Sea, the attack on Saudi Arabia’s energy infrastructure last September and recent tensions between the US and Iran.

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