Market Experts Predict Oil Prices Could Drop to $60 per Barrel by 2025
Strategists at Citi Research have forecasted a potential decline in oil prices to around $60 per barrel by 2025 due to a significant market surplus. Although recent supply disruptions in Libya and delays in production cut unwinding by OPEC+ have temporarily supported Brent prices in the $70-72 range, Citi believes this trend will not last.
Despite the OPEC+ decision to delay the production cut unwind to December 2024, with the process concluding by the end of 2025, concerns about market weakness and price declines persist. Bank of America’s Commodities Research team has also revised down its price forecast to $75 per barrel for the second half of 2024 and for 2025, citing growing global oil inventories and weaker demand growth.
With OPEC+ spare capacity exceeding 5 million barrels per day and a surplus in capacity, the outlook for oil prices has dimmed. This, combined with slower demand, reduces the risk of price spikes from potential geopolitical disruptions.
Despite ongoing disruptions to Libyan oil supplies and economic concerns in the U.S. and China, market experts recommend selling on a bounce toward ~$80 Brent, as they anticipate prices moving down to the $60 range in 2025.
**Analysis:**
The article discusses the predictions made by market experts regarding a potential decline in oil prices to $60 per barrel by 2025 due to a significant market surplus. Factors such as supply disruptions in Libya, delays in production cut unwinding by OPEC+, and concerns about growing global oil inventories have contributed to this forecast. Investors are advised to consider selling at around $80 Brent and anticipate a downward trend in prices. This information is crucial for individuals involved in the oil market or those looking to understand how global factors can impact oil prices and their financial decisions.