Market surveys estimate that US crude oil production will increase in 2017—compared to 2016. Also, implementation of Trump’s energy policies could increase US production and pressure crude oil (USO) (ERY) (PXI) (USL) prices in 2017. For more on crude oil’s bearish drivers, read Part 1 and Part 4 of this series.
Bernstein Energy reported that global oil inventories fell by 24 MMbbls (million barrels) to 5.7 billion barrels in 4Q16—compared to the previous quarter. Falling global inventories support crude oil prices. To learn more about crude oil’s bullish drivers, read Part 4 of this series.
Major oil producers’ production cut, strong crude oil demand from the US and Asia, and record gasoline demand from the US could support crude oil (IEZ) (ERX) (UCO) (RYE) prices. Saudi Arabia said that 80% of the targeted reduction of 1.8 MMbpd has been implemented in January 2017.
Crude oil price forecast
The International Energy Agency’s oil and markets division head thinks that oil prices might not exceed $65 per barrel in 2017 despite major oil producers’ production cut.
A Reuters poll estimated that Brent and US WTI crude oil prices will average $57.01 per barrel and $55.23 per barrel in 2017, respectively.
EIA’s crude oil price forecast
The EIA estimates that US WTI and Brent crude oil prices will average $52.5 per barrel and $53.5 per barrel, respectively, in 2017. It also estimates that US WTI and Brent crude oil prices will average $55.2 per barrel and $56.2 per barrel, respectively, in 2018. US WTI and Brent crude oil prices averaged $43.3 per barrel and $43.7 per barrel in 2016, respectively.
Read Will Crude Oil Prices Test 3 Digits Again? for more on crude oil price forecasts.
For more on crude oil prices, read What Can Investors Expect in the Crude Oil Market in 2017 and OPEC, Russia, and the US Will Impact Crude Oil in 2017.
For energy-related analysis, visit Market Realist’s Energy and Power page.