Baku, Azerbaijan, April 13
By Aygun Badalova - Trend:
Oil prices on the world markets rose at the end of last week amid the data on a slowdown in US drilling. Another factor positively affected the prices were the statements made from Iran and the US, which created doubts regarding the perspectives of signing the final agreement on Iranian nuclear program.
During electronic trading on the New York Mercantile Exchange on April 10, the West Texas Intermediate (WTI) for May delivery increased by $0.85 to $51.64 a barrel. Brent crude for May delivery increased by $1.3 to $57.87 a barrel on the London-based ICE Futures Europe exchange.
"A preliminary deal between Iran and the West saw oil prices fall sharply early last week, but they quickly rebounded as it became apparent that the return of Iranian oil exports would be delayed until at least next year," analysts of the British economic research and consulting company Capital Economics said in a report obtained by Trend.
The preliminary deal reached at the end of last week, between Iran and the Western powers should eventually allow Iranian oil exports to return to their previous levels, around 1 million barrels per day (bpd) higher than currently, according to the British analysts.
"However, some of the finer details still have to be ironed out. Even if a final deal is reached, Iran is unlikely to be able to significantly ramp up its exports until
2016 at the earliest," they said in the report.
British analysts believe that the return of Iranian oil to the market is likely to help keep
oil prices low over the next few years, but probably won't be enough to offset the impact of lower US shale oil production and higher demand.
Analysts expect the price of a barrel of Brent to rise slightly from about $57 today to $60 by the end of this year and $65 by the end of 2016.
Analysts from the US JP Morgan bank also does not expect oil prices to rise significantly in the short-term. Brent average price is forecasted by the analysts at $59.3 per barrel in 2015 and $61.8 per barrel in 2016.
WTI price is forecasted to average $51.8 per barrel in 2015 and $53.8 per barrel n 2016. In the third quarter of this year JP Morgan's analysts expect Brent and WTI prices to reach $63 per barrel and $56 per barrel respectively.
The US Energy Information Administration (EIA) forecasts that Brent price will average $59 per barrel in 2015 and $75 per barrel in 2016. WTI prices in 2015 and 2016 are expected to average $7 per barrel and $5 per barrel below Brent, respectively.
However, in its latest Short-Term Energy Outlook EIA said that if and when the sanctions against Iran are lifted, the baseline forecast for world crude oil prices in 2016 could be reduced $5-$15 per barrel from the current forecasted level.