Oil prices shot up to US$83 per barrel as the United States (US) Energy Information Administration (EIA) revised its forecast for this year and the next.
In its Short Term Energy Outlook, the EIA expects Brent to average at US$85.01 a barrel this year, 2.5% higher than the previous outlook. Brent prices in 2024 are revised to US$81.21 per barrel – 5% higher than before. With West Texas Intermediate (WTI) crude, expectations were raised by a similar amount.
The EIA said the higher price forecast reflects one for less global production in 2023 and a relatively unchanged outlook for global oil consumption.
Guyana to benefit most from rising oil price in Latin America region – AMI analysis | OilNOW
“Despite our higher price forecast, recent issues in the banking sector raise the potential that economic and oil demand growth will be lower than our forecast, which has the potential to result in lower oil prices,” the EIA outlined.
The Administration factored in the Organization of the Petroleum Exporting Countries (OPEC) 1.2 million barrels of crude a day production cut in its forecast. Crude prices jumped after the announcement.
Prices have retreated from a 20% spike a year ago, a direct result of Russia’s invasion of Ukraine. The OPEC cut started pushing them back up, and they have gained about 20% in the past month.
Now prices are around the same level where they started the year in 2023.
