World Bank’s Report: Crude Oil Prices Could Trend Higher in 2016
Crude Oil Prices Rose in April: Will the Bullish Momentum Continue?
Crude oil prices could rise
The IEA (International Energy Agency) estimates that the crude oil supply and demand gap could dimish in 2016. Read Non-OPEC Crude Oil Production Impacts Crude Oil Prices and Will the Crude Oil Supply and Demand Gap Narrow by Early 2017? to learn more.
Crude oil price forecasts
The latest survey by Reuters showed that analysts raised their forecast on average crude oil prices. Brent crude oil prices will average ~$42.30 per barrel in 2016. Wall Street Journal surveys show that Brent crude oil prices will average $39.25 per barrel in 2Q16 and will rise to $42.30 in 3Q16. However, Morgan Stanley expects that crude oil prices could fall in 3Q16. World Bank reported that Brent crude oil prices could average around $41 per barrel in 2016—compared to its previous estimates of $37 per barrel. This is due to expectations of the narrowing supply and demand gap.
The EIA (U.S. Energy Information Administration) estimates that Brent crude oil prices will average ~$34 per barrel in 2016 and $40 per barrel in 2017. West Texas Intermediate crude oil prices are expected to average $34 per barrel and $40 per barrel during the same period, respectively.
The roller coaster ride in crude oil prices impacts oil and gas producers like Linn Energy (LINN), Carrizo Oil & Gas (CRZO), W&T Offshore (WTI), Hess (HES), and Contango Oil & Gas (MCF). It also impacts ETFs and ETNs like the ProShares UltraShort Bloomberg Crude Oil ETF (SCO), the Direxion Daily Energy Bull 3x Shares ETF (ERX), the PowerShares DWA Energy Momentum (PXI), and the United States Brent Oil (BNO).
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