What will happen to oil next: forecasts

The question of what will happen to oil is of interest to a fairly large percentage of the world's population. The increased interest in the formation of prices for "black gold" is explained by their influence not only on the economy of many countries, but also on the world economy as a whole.

Prices for 2014

In the second half of 2014 the cost of raw materials was at the level of $ 110, which suited not only Russia, but also other countries that exported fuel. The budget of Russia was replenished due to the active work of the largest oil-producing enterprises, in particular, such as Gazprom. Oil rose in price until mid-summer of 2014 and reached its apogee at around $ 115. A similar situation developed in the US, in the OPEC countries and in some European countries. From the end of the summer of 2014 until the end of December, the whole world saw a rapid drop in oil prices, which reached $ 60. By the end of winter, a multi-year low was fixed at about $ 48. At that time even world experts could not with partial certainty talk about what would happen to oil in the near future, since all the forecasts made the day before were almost completely erroneous.

Factors that stimulated the fall of oil, and their impact now

Trying to make a forecast for the future, many experts are based on factors that, in their opinion, led to a drop in prices. We can talk about the following points:

• Decrease in the growth rate of the world economy. The EU countries and China have halted in development, Japan in a recession. Industry of states requires less fuel, which leads to a sharp reduction in demand. A large amount of fuel and a small interest in it stimulate a drop in prices. Experts predict a slight improvement in the situation by the end of 2015.
• OPEC countries, starting from September 2014, significantly increased volumes of produced fuel to the level of 30.5 million barrels. Saudi Arabia has officially announced that it does not intend to reduce quotas for the extraction of "black gold" even if its value in the world market is only $ 20.
• The growth of oil production in the United States to the level of 8.9 million barrels.
• Big competition became the basis for discounts on fuel purchases. In a tough battle for the consumer in 2015 to concede in the price agreed countries such as Qatar and Iran, Saudi Arabia.
• The total demand for carbon is reduced due to the development of energy saving technologies in Europe. The trend in the coming decades will not change.

If we take into account all the factors together, they say that by the end of 2015 the situation on the world oil market will not return to the previous one. Most experts show an increase in the cost of fuel to a level of $ 75. On the market on May 5, 2015, the price was fixed at $ 70.

The cost of oil in 2015, taking into account the decisions of the governments of the countries

Many experts, trying to make a prediction about what will happen to oil this year, are based solely on the decisions of the governments of the countries participating in the world oil market. The budget of Saudi Arabia was drawn up taking into account the fact that the cost of a barrel of oil will not fall below the figures of 2014. Proceeding from this, many experts bet on the fact that fuel will be traded at the level of 99 dollars during the whole of 2015. After the collapse of the market, the country's budget was completely revised. The rate was made at $ 60 per barrel of oil. The field of official publication of budgets began to appear forecasts that in 2015 the price of fuel will not exceed the price tag of $ 65. This link to Saudi Arabia is due to the fact that the state is the leader of the cartel called OPEC.

What did they say at the international conference in April 2015?

In April 2015, an international conference was held in Texas, where oil issues were actively discussed. In the speech of the head of the company "Lukoil" there were words that the prices for fuel will no longer creep down. Businessman Vagit Alekperov noted the fact of reaching and breaking through the prices of its historical minimum, which directly indicated an unlikely continuation of the trend. According to analyst Jeff Kerry Goldman Sachs, in the first half of 2015, prices went down due to the publication of poor forecasts for the third quarter of 2015. He attributes the preconditions of the phenomenon to the extremely sharp growth of the US dollar rate. Jeff emphasizes that the situation has stabilized a little. With his opinion, Yuha Kakhenyan, who holds the post of deputy director of the IMF unit in Asia and the Middle East, fully agreed. Both experts are inclined to further price increases, which the IMF also forecasted. Recall that in late August 2014, experts were guided by the cost of oil by the end of 2015, within the limits of 99 dollars.

The second side of the medal

Considering the question of what will happen to oil in the future, does not agree with the opinion of Kahyan and Kerry, and also refutes the IMF forecast Aidar Kozybaev, a representative of the National Bank of Kazakhstan. He says that world oil can not hold at around $ 99 in the near future, moreover, it will not even reach this level. The economist is betting on $ 85 per barrel of Brent oil and $ 75 per barrel for WITI oil . The expert bases his assumptions on the strong influence of the situation in Russia on such countries as Azerbaijan and Uzbekistan, Kazakhstan and Turkmenistan, which are importing states. Overabundance of oil caused a fall in prices, and the spring stabilization of the situation in a number of states has significantly affected the restoration of the price level. In the long term, the trend will continue, despite the fact that the high of 2014 (105 - 110 dollars per barrel) will not be achieved.

The most shock forecasts of 2014: the market against the state budget

Back in 2014, the most frightening forecast, which was considered by only a few world analysts, including Russian ones, was the one according to which quotations of oil would drop to the level of $ 60. For the most part, experts agreed with the price of "black gold" in 2015 at $ 90. A less stressful scenario assumed a decline in Urals oil to 91 dollars in 2015 and to $ 90 during 2016 - 2017. Presumably, this should lead to a decline in GDP in 2015 to a level of 0.6% with a recovery to 1.7 - 2.8% in 2016 - 2017. The way the situation unfolded in fact (falling below the level of $ 49 per barrel in January) was followed by the whole world. The oil market behaved in an unpredictable manner.

Where to find the truth?

All the forecasts that analysts are able to give today vary in a wide range: from incredibly optimistic to stressful. The OPEC countries, which do not intend to reduce their fuel production quotas, consider the scenario with prices falling to $ 20, since they declare that they will not change their tactics in this situation either. The IMF looks confidently into the future and believes that by the end of 2015 oil quotes will please values in the range of 90 - 99 dollars. Most market participants simply follow the situation and avoid important decisions. You can say that the truth is somewhere in the middle, as evidenced by the situation on the market today. Despite the fact that oil production in the countries for the last 3 - 4 months has not changed, the cost of fuel has slightly leveled off. So, as of mid-June 2015, the Brent brand is at a level close to 65 dollars per barrel, despite the fact that the level was tested at $ 70 per barrel.

Monthly statistics for 2015

So, where will the oil market go in the future? Studying fundamental factors, many experts say about the same thing. Exports of oil in many countries will remain at the same level until the end of 2015, which gives good reason to talk about the following values:

• In early June, the price of oil averaged $ 66, at the end of the month it will stop at $ 69. The forecast is a maximum of $ 76 and a minimum of $ 60. During the first two weeks of June, the mirror tops were not reached yet.
• July forecast more promising. It will start at around $ 69 and end with a price of $ 72. The maximum and minimum will be at levels of $ 77 and $ 61. The average price is 71 dollars.
• From September to December, the price range, despite the fact that oil production by countries can be redistributed due to the development of resource deposits in Russia in the Arctic and the activation of projects in the US, will vary from $ 55 to $ 77.

What is the world market waiting for in 2016 - 2017?

Far from stable situation in the world does not hinder large world analysts, including representatives of Gazprom, oil and its movement, not only in the near future, but also in the long term. Having compared numerous forecasts, we can say that during 2016, there will be no catastrophic drop in the market. On the contrary, the situation will continue to improve. Experts recommend starting from a minimum of $ 68 in January and expect a maximum of $ 105 in December. In 2017, the situation will not change. In March, April and May, it is possible to reduce to $ 63 per barrel with a further recovery to $ 102 in June.

The latest forecast from the Ministry of Economic Development of Russia

The Ministry of Economic Development of Russia is set to reduce the cost of oil in 2016 by 10%. The toughest forecast speaks of a price of $ 50 by the end of 2015. Comprehensive recovery of the price range of the late summer of 2014 is expected in 2018, but not earlier. The document with the information was presented to the public on April 10, 2015, while its modification and modernization is being scaled up, adapting to the situation in the near future. On the direction in which the price of oil will go, a world-class economy can impose an imprint at any time, especially if we take into account the redistribution of the shares of the international oil market. To adhere to one of the officially published opinions is not worth it, since the events that can happen in the world will correct the situation with interest. Large world oil companies, such as Gazprom, can not send oil in the right direction. It remains only to follow the events in the world. With their consideration, it is possible to explain to some extent how oil quotes will be formed.