Oil prices expected to rise despite recent fall, analysts say | Policy

Falling oil prices This week, there was concern over supply oversupply, but analysts believe that rising demand and an impending supply shortage could trigger a rebound that will drive up prices in the weeks and months ahead.

The benchmark Brent, crude, fell to nearly $ 62 per barrel from $ 86 last month and its lowest price since spring, as oil prices were still recovering after the fall. nadir of 45 dollars a barrel in 2017.

The steep drop is likely to "outpace" fundamentals such as supply and demand that usually govern markets, Goldman Sachs said in a report released this week.

"While we expect a price rally, we continue to forecast strong price volatility until proof of the beginning of improved oil market fundamentals, necessitating a decline in oil production. OPEC and signs of resistance from demand, "the report says.

The recent price decline was attributed to several factors: oil producers and traders, who expected a reduction in supply resulting from the reinstatement of sanctions to Iran, were caught off guard when the Trump administration suddenly granted exemptions to eight countries allowing them to continue to import oil from the Islamic republic.

At the same time, oil markets have experienced an unexpected increase in the supply of second-tier producers such as Norway and the United Kingdom in the North Sea, as well as Mexico. Combined with increased supply from Russia and Kazakhstan, which increased production in anticipation of sanctions imposed by Iran, countries marketed more than 800,000 barrels a day between August and October. Shale oil production in the United States has increased over the same period.

"A group of people responded to the Iranian crisis and it overwhelmed us," said Steven Kopits, chief executive of consulting firm Princeton Energy Advisors. recently said American News. "Some have done wrong, some have responded to the sanctions and the fact that the Trump administration has deflated and granted a series of waivers to the best Iranian customers."

While the recent price decline reflected potential concerns over a glut in the near term, the Wood Mackenzie consulting firm cautioned against a long-term tightening, which could be felt as early as the 2020s at following the discovery of new oil deposits. failed to keep pace with the expected growth in global demand.

"The alarm signals are there: the industry does not find enough oil," warned the company. "The problem is that the recent rate of detected commercial volumes leaves little to think that there will be enough new discoveries to fill the gaps."

Such a slowdown could be mitigated by a slowdown in the global economy. Global markets have shown signs of slowing down, especially in developing economies.

This week, Fatih Birol, executive director of the International Energy Agency, urged oil producers to interview with Reuters use common sense.

"The global economy is still going through a very difficult period and is very fragile and, because of the increase in production, we have a very limited production capacity in the world, in a world that is becoming more and more more dangerous, "said Birol. .