British analysts expect gradual recovery of oil prices
Baku, Azerbaijan, Nov. 17
By Aygun Badalova - Trend:
British analysts expect gradual recovery of oil prices with Brent price to average $60 a barrel and WTI price to average $55 a barrel by end of 2016.
Last week's renewed slide in the price of oil (to $44 for a barrel of Brent) has prompted us to lower our end-2015 forecasts, but we continue to expect a gradual recovery, Julian Jessop Chief Global Economist at the British economic research and consulting company Capital Economics said in a report obtained by Trend.
Global oil stocks have climbed further as supply continues to outpace demand. Nonetheless, the pace of stockbuilding did at least slow last quarter, he said.
What's more, commodity markets, including oil, seem overly-pessimistic on the prospects for demand, according to Jessop.
"Many have suggested that the next global recession may be around the corner. But our view is that the balance of risks to world growth in the next year or two now lies on the upside," Jessop said.
Overall, analysts expect oil prices to be lifted both by further evidence of cuts in supply in response to the previous sharp falls and by an improvement in sentiment towards global demand.
Analysts lowered their end-2015 forecasts for Brent to $50 per barrel (from $55) and for WTI to $45 per barrel (from $50), but they left their end-2016 forecasts at $60 and $55 per barrel respectively.
The price for Brent rose by 1 percent to $45.04 a barrel on London's ICE Futures exchange on Tuesday. On the New York Mercantile Exchange, WTI futures were trading up 0.5 percent at $41.92 a barrel, according to The Wall Street Journal.