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The
poll of 37 analysts and economists surveyed by Reuters in the
last two weeks forecast Brent crude would average $82.86 per
barrel in 2024, a fourth straight cut in estimates, from $83.66
forecast in July.
The poll showed U.S. crude would average $78.82 this year,
slightly lower than last month's estimate of $79.22.
"Despite heightened geopolitical tensions, oil prices have been
trading below $90 per barrel so far this year, as weak crude
intake from China and Europe has offset the bullish impact of
still-curbed OPEC supplies," Florian Grunberger, senior analyst
at data and analytics firm Kpler.
Analysts anticipated global oil demand growing by 1.0 to 1.3
million barrels per day (mbpd) in 2024, compared with 1 and 1.5
mbpd growth forecast in the previous poll.
OPEC also cut its forecast for global oil demand growth in 2024,
citing weaker than expected data for the first half of the year
and lower expectations for demand from China.
"This slowdown in consumption has led to a rise in inventory
stock in the U.S. which could further put downward pressure on
prices," Sehul Bhatt, Director-Research at CRISIL Market
Intelligence and Analytics, said.
Conflicts are ongoing in the Middle East and between Russia and
Ukraine, but analysts said the risk premium on oil had shrunk
because there has been no material impact on oil flows.
However, a further widening of the Israel-Hamas conflict paired
with sustained supply outages, including disruptions in Libya,
could drive prices above $90 a barrel, Kpler's Grunberger said.
"The floating storage has risen recently. Also, the announced
production enhancement by the OPEC+ alliance is a burden on oil
prices shoulder so far," said Thomas Wybierek, analyst at NORD
Landbk.
The Organization of the Petroleum Exporting Countries and allies
(OPEC+) earlier this month confirmed its plan to start unwinding
the most recent layer of cuts of 2.2 million bpd from October,
but repeated earlier comment the increase in supply could be
paused or reversed if needed.
"We still assume that OPEC will raise production in the fourth
quarter as the market is potentially shifting from an
equilibrium where OPEC supports spot balances and reduces
volatility to a more long-run equilibrium focused on
strategically disciplining non-OPEC supply and supporting
cohesion," Goldman Sachs said in a note this week.
(Reporting by Anushree Mukherjee and Swati Verma in Bengaluru;
editing by Barbara Lewis)
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