US dollar causes significant increase in oil price forecasts
Baku, Azerbaijan, Feb.2
By Leman Zeynalova – Trend:
A further depreciation of the US dollar gave a helping hand to commodities prices, especially oil in January, said a report from UK-based consulting company Capital Economics.
Oil prices surged to their highest level since late 2014, according to the report obtained by Trend.
“In US dollar terms the gold price has risen by 17 percent since the start of 2017 and 7 percent since mid-December when the Fed hiked interest rates for the fifth time in this tightening cycle. We think that the recent strength in prices can be largely attributed to dollar depreciation,” said the company.
Therefore, Capital Economics has revised its forecasts for world oil prices up.
The quarterly forecast for Brent is as follows: $67 per barrel in Q1 2018, $65 per barrel in Q2, $63 per barrel in Q3 and $60 per barrel in Q4, according to Capital Economics.
This is while in its previous report, the company forecasted Brent crude oil prices to range between $63 and $55 per barrel throughout 2018.
As of 2019, the consulting company expects Brent prices to stand at $55 per barrel as in the previous report.
As of West Texas Intermediate (WTI) oil, Capital Economics analysts expect $62 per barrel in Q1 2018, $60 per barrel in Q2, $58 per barrel in Q3 and $44 per barrel in Q4.
WTI is expected to drop to $52 per barrel in 2019, according to the report.
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