BAKU, Azerbaijan, Oct.7
By Leman Zeynalova – Trend:
The US Energy Information Administration (EIA) forecasts monthly Brent spot prices will average $42/b during the fourth quarter of 2020 and will rise to an average of $47/b in 2021, Trend reports with reference to the US Energy Information Administration’s (EIA) in October Short-term Energy Outlook (STEO).
“Brent crude oil spot prices averaged $41 per barrel (b) in September, down $4/b from the average in August. The decrease in oil prices coincided with slowing increases in global oil demand. Month-over-month consumption rose by 1.0 million b/d on average during August and September compared with an increase of 4.1 million b/d from May through July.
“EIA estimates that global oil markets have shifted from global liquid fuels inventories building at a rate of 7.3 million barrels per day (b/d) in the second quarter of 2020 to drawing at a rate of 3.1 million b/d in the third quarter. EIA expects inventory draws in the fourth quarter to be 3.0 million b/d before markets become more balanced, with inventory draws of 0.3 million b/d on average in 2021.
“Despite expected inventory draws in the coming months, EIA expects high inventory levels and surplus crude oil production capacity will limit upward pressure on oil prices. During early September’s heightened volatility, Brent crude oil prices fell to less than $40/b then began to stabilize from mid-September through October 1, trading at an average level of $42/b. Some of the initial decline in prices came as a result of announcements that opposing parties in Libya had agreed to lift the export blockade that had reduced production in the country from 0.8 million b/d in January (the month before the blockade began) to less than 0.1 million b/d in August (the month before the blockade was lifted),” reads the report.
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