Oil prices are likely to remain at current high levels in March and April, with Brent prices averaging between $ 65 and $ 70 per barrel, after the OPEC + group unexpectedly decided to maintain its production cuts in April, he said. the US Energy Information Administration (EIA). on Wednesday.
In its Short-Term Energy Outlook (STEO) for March, the EIA expects Brent prices to average $ 65 to $ 70 a barrel in March and April, more than $ 10 a barrel above forecast February, mainly due to OPEC + maintaining tight production control in April.
Earlier this month, the OPEC + alliance decided not to increase production as of April, except for small increases for Russia and Kazakhstan, while OPEC’s largest producer and de facto leader, Saudi Arabia, is maintaining its extra cut of 1 million bpd in April. This was contrary to market expectations, which revolved around the group easing the cuts by 500,000 bpd and the Saudis reversing the additional cut.
For the second quarter of 2021, the EIA sees Brent prices averaging $ 64 per barrel and then averaging $ 58 per barrel in the second half of 2021, as it expects downward price pressures to emerge in the coming months, as the oil market becomes more balanced.
Wood Mackenzie expects oil prices to rise to $ 70 to $ 75 a barrel during April, with inventories attracting significantly more than 1 million barrels a day next month as the summer demand season get closer.
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“The risk is that these higher prices dampen the attempt at a global recovery. But Saudi Arabia’s energy minister, Prince Abdulaziz, is adamant that OPEC + should be on the lookout for concrete signs of increased demand before starting production, ”said Ann-Louise Hittle, vice president of Macro Oils, of Wood Mackenzie, after the OPEC + meeting earlier this month.
After OPEC +’s surprise decision to keep oil production stable in April, Goldman Sachs now sees Brent prices reaching $ 80 a barrel in the third quarter of this year and $ 75 in the second quarter, an increase of $ 5 compared to the previous forecast released just two weeks earlier.
By Charles Kennedy for Oilprice.com
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