Baku 22° C
Baku. 19 November. REPORT.AZ/ One could forecast, for the months coming, an oil price in the range of 50 to 80$/ barrel, French expert Colette Lewiner said.
"During these last two years the global economy was booming pushing oil demand up. Restrictions of production were decided by OPEC plus Russia and in addition some geopolitical issues (as Iran sanctions on oil exportation or Venezuela economic collapse) restricted oil exportations. This pushed prices up to more than $80/barrel (in October 2018) for the first time since 2014," the expert said.
She believes that since then, the market has changed: "We are experiencing economy slow down notably in China that is a big consumer. Moreover, US shale oil exportations that were hampered by oil pipelines bottlenecks will flow better in 2019 allowing more US oil to be exported. In addition, Iranian sanctions were mitigated for some consuming countries by the US. This resulted in increasing oil reserve."
French expert Colette Lewiner
"Restrictions of production were decided by OPEC plus Russia and in addition some geopolitical issues (as Iran sanctions on oil exportation or Venezuela economic collapse) restricted oil exportations."
Kolet LevaynerFrench expert Colette Lewiner
Responding to the question about the mark at which prices may stabilize in the coming future, the expert noted that oil production is a very capital intensive industry with long lead times between investment decisions and oil production. She believes that this industry needs stable oil prices to take sound investment decisions.
"It is difficult to believe that OPEC would start again a commercial war with the US as this war pushed the prices down to 26$/barrel, a price level detrimental to their economy and as shale oil producer survived by lowering their production costs. On the high end side, one has to remember that in 2008, the oil barrel price peak at $150 coincided with the beginning of the economic recession that in turn pushed prices down. One could forecast, for the months coming, an oil price in the range of 50 to 80$/barrel," the expert said.
