BAKU, Azerbaijan, December 20. The Oxford Institute of Energy Studies (OIES) has revised its Brent crude oil price forecasts downward, Trend reports.
Specifically, the projection for 2023 has been adjusted by $0.8/b to $82.6/b, and for 2024, it has been reduced by $1.8/b to $82.3/b. These adjustments reflect a decrease from the previous estimates of $83.4/b and $84.1/b for 2023 and 2024, respectively, reported last month.
The November performance of Brent witnessed a month-on-month decline of 9% to $83.2/b, down from $91.1/b in October. Subsequently, in the first two weeks of December, Brent extended its losses to reach the low-to-mid $70s, averaging at a five-month low of $75.8/b. The initial expectations of a significant deficit in the fourth quarter of 2023 were moderated by a robust supply performance. Consequently, the outlook for Brent prices in 4Q23 has been revised downward by $3.2/b to $84.0/b, compared to the previous forecast of $87.3/b.
Looking ahead to 2024, the anticipated price outlook has been adjusted lower by $1.8/b to $82.3/b. Brent prices are expected to rebound to $83.3/b in the first quarter of 2024, supported by the implementation of new OPEC+ production cuts. Subsequently, prices are anticipated to remain within the $80s in the following two quarters before dipping back to the high-$70s by year-end. Overall, the forecast suggests that the price range of $75-85/b observed in 2023 is likely to be maintained throughout 2024.
The Brent Prospect, holding at $83.5/b in 2024, is $1.2/b higher than the reference price. This differential reflects persisting weaknesses in the first quarter, attributed to weaker demand and/or patchy OPEC+ compliance. However, the outlook anticipates overcoming these challenges with upside potential in the remainder of the year, particularly in response to OPEC+ actions.
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