The oil prices were bullish in the market as geopolitical tensions in the Middle East dies down. The commodity’s prices managed to hit another milestone despite the astonishing performance of the dollar in the market. The commodity continues to push great performance in the market on multiple factors. The great oil inventories reports and the OPEC agreement to extend the output cut have managed to put the prices on its best figures ones again. Click Read More below for additional information.
Oil prices are likely to rise this year thanks to supply disruptions and an OPEC-led deal to limit production, but doubts over the future of compliance with the multilateral agreement and rising U.S. production could stem the upward momentum, a Reuters poll showed on Thursday.
A survey of 31 economists and analysts polled by Reuters showed Brent crude LCOc1 would average nearly $64 a barrel in 2018, versus $63 forecast in the February survey, but below the $67.18 average for the benchmark so far in 2018.
Brent prices have risen 4 percent this year, supported by a deal between the Organization of the Petroleum Exporting Countries and non-OPEC producers led by Russia to curb output by about 1.8 million barrels per day (bpd) through 2018.
The price briefly rose above $70 a barrel this week, supported by tension in the Middle East and declining output in Venezuela, one of the group’s largest producers, where the economic crisis has cut production to its lowest in nearly 30 years.
A sustained drawdown in U.S. inventories also helped push the price up towards $70, a peak last seen in December 2014.
“We view it rather unlikely that OPEC will exit already by mid-year. However, talking about a possible extension of the deal beyond 2018, we are rather skeptical,” Hannes Loacker of Raiffeisen Capital Management said.
“We see a big challenge in bringing in Russia once more. Without Russian participation, the will of some other OPEC members may also be abating somewhat.”
Saudi Arabia and Russia are working on a long-term pact that could extend controls over world crude supplies by major exporters for many years.