Experts do not foresee any significant upturns in oil prices next year, as reported by The Wall Street Journal.
Analysts and investors, who had earlier hoped for a recovery in crude prices in late 2015, no longer expect any strong rebounds before the end of 2016. Moreover, major banks have already started revising their forecasts downwards amid broad-based speculation that the average oil price in the coming year would not exceed this year’s levels.
The global oil market is seeing a major slump in demand in the light of ever more increasing crude stockpiles and petroleum inventories. The accelerating pace of oil production worldwide raises deep concerns among investors as full storage tanks are likely to put further pressure on oil, causing even sharper declines in global prices. As a result, some oil bulls may even have to leave the market for good, the newspaper warns.
US authorities slashed their price forecasts for WTI crude for 2016 saying that the average figure would probably be around $50.89 per barrel instead of $51.31 cited earlier. The American Merrill Lynch bank in turn cut its projections from $53 to $48 per barrel. On average, crude oil has been trading on the New York Mercantile Exchange at about $49.6 per barrel over this year.
As for Brent crude, the price plummeted by more than three percent on the London ICE Futures Exchange in just one session, coming in at $36.8 per barrel. Thus the North Sea benchmark hit its 2008 lows.
