International oil group Plats expected the price of Brent crude to rise to $75.70 a barrel in 2019 after a survey by 11 banks and a major oil company, and predicted that the Organization of the Petroleum Exporting Countries would reduce oil production at next meeting by at least one million bpd. The company pointed out that the growth in oil demand is still doing fine despite the weak indicators.
Large banks believe that the recovery of Brent crude from the current levels at $63 a barrel is possible, in the event that OPEC cuts production by about one million barrels per day at its next meeting in early December. The organization aims to support prices and reduce global inventories, in order to push oil prices back to the level of $70 a barrel or more.
Oil experts expected price fluctuations to continue this week after Brent crude lost 11% and US crude (WTI) 10% last week due to fears of oversupply in the market. They also expect the oil market to receive some support through improved demand indicators after OPEC and its non-OPEC allies cut production at the meeting early next month. Oil prices fell more than 6% at the end of last week, the lowest level in a year due to increased global supply.
Oil supplies grow at a faster pace than demand in order to avoid a large increase in unused fuel stocks, like in 2015. The Organization of the Petroleum Exporting Countries is considering starting production cuts at its next meeting on Dec. 6. OPEC’s attempts to support prices have not yet yielded positive results, with prices falling more than 21% since the beginning of November. Prices are also heading for the biggest monthly drop since late 2014, as markets are currently affected by trade tensions between the United States and China, the world’s two biggest economies and largest oil consumers.
Brent crude futures were down $3.81 or 6.08% to $58.81 per barrel, after hitting an intraday low of $58.40, its lowest level since October 2017. futures American crude rose 7.72% to $50.52 a barrel, its lowest level since October 2017.
Trading in US markets was limited due to the Thanksgiving holiday. Oil prices are still under pressure from rising US crude stocks, with inventories jumping by 4.9 million barrels, to reach 446.91 million barrels last week, their highest since December.