WASHINGTON (Pakistan Point News / Sputnik - 08th April, 2020) The United States lowered its 2020 Brent crude oil price forecast by 23 percent largely due to the coronavirus pandemic, the US Energy Information Agency (EIA) revealed in a report on Tuesday.
"EIA forecasts Brent crude oil prices will average $33/b in 2020, $10/b lower than in last month's STEO [Short-Term Energy Outlook] and down from an average of $64/b in 2019," the report said.
Lower demand growth reflects growing evidence of significant disruptions to global economic activity because of COVID-19, the agency said.
EIA also projected that prices will be around $23 per barrel during the second quarter of this year before they rise to $30/b during the second half of 2020.
Brent crude oil prices averaged $32 per barrel in March, the report added, a decrease of $24 per barrel from the average in February and the lowest monthly average since January 2016.
"EIA forecasts that average Brent prices will rise to an average of $46/b in 2021, $10/b lower than forecast last month, as a return to declining global oil inventories puts upward pressure on prices," it added.
Moreover, EIA projected global petroleum and liquid fuels demand to decrease by 5.2 million b/d in 2020 from an average of 100.7 million b/d last year. However, the agency expects it to increase by 6.4 million b/d in 2021.
After the OPEC+ member states failed to come to an agreement about the oil deal's future on March 6, restrictions on crude production have been lifted since April 1. Together with the impact of the COVID-19 pandemic, it caused the prices to fluctuate dramatically down to multi-year lows over the past several weeks, with the price slightly over $33 a barrel as of Monday.
