Dated Brent crude prices are likely to fall to around $55 per barrel by year-end, an S&P Global executive said at the Asia Pacific Petroleum Conference on Monday.
Brent crude futures were up about 0.5% on Monday at $65.84 per barrel after OPEC+ agreed over the weekend to raise output from October at a slower pace than in previous months, on expectations of weaker global demand.
“We still see prices coming down closer to the $55 a barrel dated Brent, with OPEC continuing to unwind production into the market,” said Dave Ernsberger, co-president, S&P Global Commodity Insights.
“If there’s a massive surplus, if Russian oil continues to flow into the market, if stock-building stops and some of this stuff goes into commercial inventory, contangos blow out, we can see a lower price than that,” he said.
Contango occurs when prompt prices are lower than those in future months, indicating comfortable supplies.
Dated Brent is used to price more than 60% of globally traded crude and underpins oil futures.
