Crude oil prices look likely to trade below $70 per barrel in 2019 as surplus production, much of it from the United States, and slowing economic growth undermine OPEC-led efforts to shore up the market, a Reuters poll showed on Monday.
A survey of 32 economists and analysts forecasts the North Sea Brent crude oil benchmark <LCOc1> will average $69.13 per barrel in 2019, more than $5 lower than last month’s projection.
Brent has averaged $71.76 in 2018.
“The first half of 2019 will be dominated by concerns about oversupply,” said Ashley Petersen of Stratas Advisors.
The Organization of the Petroleum Exporting Countries and other producers including Russia, known collectively as OPEC+, agreed earlier this month to cut production by 1.2 million barrels per day (bpd) to try to drain global crude inventories and support prices.
But the cuts are not due to take place until January and prices have fallen more than 15 percent since the announcement.
Oil prices have fallen more than 40 percent from multi-year highs reached in early October on concerns about the impact of a trade dispute between the United States and China on global economic growth and demand for oil.
Another potential headwind next year is slowing consumption.
Many analysts project demand growth of a little over 1 million bpd in 2019, compared with an increase of 1.54 million bpd in 2018, according to the U.S. Energy Information Administration.
(Reporting by Brijesh Patel; editing by Christopher Johnson and Jason Neely)