OIL PRICES - 2015

Last week OPEC held a conference to review the outlook on the bleak oil market. The global economic growth is set to make a small change in forecast in the New Year with a slow steady rise of 4%. This rise was accumulated with the apprehension of the recovering global economy and the expectation of a higher demand for oil in 2015. This confidence has arisen due to the fact that many projects are stable and "comfortably above the five-year average, coupled with the on-going rise in non-OECD inventories, are indications of an extremely well-supplied market."

Overall, OPEC has decided to stick to their previous plans made in 2011 and maintain the production level of 30.0 mb/d. There was in no doubt concern over the rapid decline in oil price at the conference, but OPEC suggested that during this period it gave producers time to invest. This eye-opening decline in oil price had pushed the big players to look further into the future of oil and what action should be taken, to meet future demands.

Overall the conference gave a positive outlook on the future of 2015 with a small but steady increase. The OPEC daily basket price stood at US$66.27 a barrel Thursday, 4 December 2014, Brent crude hit a $63.72 a barrel on Monday 1 December 2014, which is a five year low. Cuts against official selling prices from Saudi Arabia are currently resonated across the global market.

oilandgaseurasia.com