OIL PRICE LEVEL: $70

AN - Bank of America Merrill Lynch has retained its forecast that oil will average at $70 this year, after prices rebounded from a two-year low in December.

Despite recent market volatility and economic jitters, the bank sees oil demand growth remaining roughly unchanged at 1.2 million barrels a day in 2019, according to its Global Energy Weekly report.

"Despite bearish investor positioning, Brent has bounced back above $60 a barrel and we retain our $70 a barrel forecast for 2019," the bank said.

"As we revisit our balances in the light of the recent volatility, we adjust demand for lower growth but do not embed a much feared recession into our forecasts."

A output-cut deal between OPEC and other producers from outside the group led by Russia — together known as OPEC+ — is likely to see a drop in output by 1.6 million barrels a day, the bank said.

"We see a major rebalancing with Saudi (Arabia) and UAE likely reducing output by 1.2 million barrels a day from November levels ... Other members of the Declaration of Cooperation (DoC) should help too," it said.

The steep fall in oil prices in the last quarter of 2018 was partly due to a reversal of the inventory declines observed during the first half of the year, the bank noted.

Despite the relatively upbeat forecast for oil prices this year, Bank of America Merrill Lynch warned about the sensitivity of the market to changes in global GDP growth.

The price of Brent crude could drop to $35 a barrel if global GDP slows down from 3.5 percent to 2.0 percent, the bank said.

The bank's forecast of oil at $70 marks the upper limit of prices predicted by Oman's oil minister. Mohammed Al-Rumhi told Bloomberg TV that the OPEC+ agreement can sustain prices at $60 a barrel, and that he sees crude trading between that bottom and $70 this year.

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Earlier: 

2019, January, 14, 12:20:00 OIL PRICE: NEAR $60 REUTERS - International Brent crude oil futures were at $59.88 per barrel at 0816 GMT, down 60 cents, or 1 percent from their last close. U.S. West Texas Intermediate (WTI) crude futures were down 59 cents, or 1.1 percent, at $51 a barrel.

2019, January, 14, 11:45:00 OIL NEED INVESTMENT PLATTS - Oil prices averaging $70/b in 2018 underscore the need for more investment in new supply, UAE energy minister Suhail al-Mazrouei told delegates at the Atlantic Council's Global Energy Forum in Abu Dhabi on Saturday.

2019, January, 11, 11:55:00 OIL PRICE: NEAR $62 REUTERS - International Brent crude futures LCOc1 were at $61.62 per barrel at 0749 GMT, down 6 cents, or 0.1 percent, from their last close. U.S. West Texas Intermediate (WTI) crude futures CLc1 were 4 cents above their last settlement, at $52.63 per barrel.

2019, January, 9, 11:20:00 OIL PRICE: ABOVE $59 REUTERS - U.S. West Texas Intermediate (WTI) crude oil futures CLc1 were at $50.42 per barrel at 0752 GMT, up 64 cents, or 1.3 percent, from their last settlement. That marked the first time this year that WTI has topped $50 a barrel. International Brent crude futures LCOc1 were up 69 cents, or 1.2 percent, at $59.41 per barrel.

2019, January, 9, 11:15:00 OPEC OIL PRODUCTION DOWN 630 TBD PLATTS - OPEC crude production in December tumbled 630,000 b/d month on month, an S&P Global Platts survey of industry officials, analysts and shipping data showed Tuesday, but the organization still has much more cutting to do to reach its new quotas for 2019.

2019, January, 9, 11:10:00 SAUDI'S OIL PRODUCTION DOWN 400 TBD MEOG - Saudi Arabia reportedly cut its crude production by more than 400,000 barrels per day (bpd) in December 2018. Saudi crude production sat at 10.65 million bpd (mbpd) that month, down from 11.07 mbpd in November.

2019, January, 9, 10:45:00 VENEZUELA'S OIL PRODUCTION: BELOW 1 MBD PLATTS - The US Energy Information Administration forecasts that Venezuelan oil production will fall below 1 million b/d in the second half of 2019, according to Erik Kreil, an international energy analysis team leader with the EIA.