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8 Jan 2015
Oil might reach $80/barrel in 2016 – National Bank
FXStreet (Barcelona) - The Research Team at National Bank, shares IEA’s view that oil demand might rise to 1.1% in 2015 up from 0.7%, and further anticipate oil to rise to $80/ barrel in 2016.
Key Quotes
“Since the oil price slide exacerbates the decline of market interest rates by softening inflation, consumers worldwide are enjoying a potent spending stimulus that will benefit growth.”
“On the other hand, the economies of OPEC members and Russia, with large oil net exports are being pummelled. Angola, Venezuela, Algeria, Iran, Iraq, Nigeria and Russia could be in for outright contractions due to a deterioration of their terms of trade ranging from 5% to 25% of GDP.”
“Investment incentives in the U.S. energy sector have fallen to a 40-year low. With the U.S. Department of Energy now forecasting that shale oil production will flatten in 2015, capital spending could fall $30 billion next year. Thus the supply of oil could stabilize.”
“Meanwhile, the International Energy Agency (IEA) sees demand rising 1.1% in 2015, up from 0.7% this year. Our current call is continued expansion of the global economy in 2015 with oil averaging US$70 a barrel. For 2016 we assume $80 a barrel.”
Key Quotes
“Since the oil price slide exacerbates the decline of market interest rates by softening inflation, consumers worldwide are enjoying a potent spending stimulus that will benefit growth.”
“On the other hand, the economies of OPEC members and Russia, with large oil net exports are being pummelled. Angola, Venezuela, Algeria, Iran, Iraq, Nigeria and Russia could be in for outright contractions due to a deterioration of their terms of trade ranging from 5% to 25% of GDP.”
“Investment incentives in the U.S. energy sector have fallen to a 40-year low. With the U.S. Department of Energy now forecasting that shale oil production will flatten in 2015, capital spending could fall $30 billion next year. Thus the supply of oil could stabilize.”
“Meanwhile, the International Energy Agency (IEA) sees demand rising 1.1% in 2015, up from 0.7% this year. Our current call is continued expansion of the global economy in 2015 with oil averaging US$70 a barrel. For 2016 we assume $80 a barrel.”