Oil prices will stage a steady recovery this year as vaccines reach more people and speed an economic revival, with further impetus coming from stimulus and output discipline by top crude producers, a Reuters poll showed.
The survey of 55 participants forecast Brent crude would average $59.07 per barrel in 2021, up from last month’s $54.47 forecast.
This is the biggest month-on-month upward revision for the yearly forecast in Reuters polls going back until at least 2016.
Brent has averaged around $58.80 so far this year.
“Travel and leisure activity look set to catch up to buoyant manufacturing activity due to the mix of stimulus, confidence, vaccines, and more targeted pandemic measures,” said Norbert Ruecker of Julius Baer.
“Against these demand dynamics, the supply side is unlikely to catch up on time, leaving the oil market in tightening mode for months to come.”
Of the 41 respondents who participated in both the February and January polls, 32 raised their forecasts.
Most analysts said the Organization of Petroleum Exporting Countries and allies (OPEC+) may ease current output curbs when they meet on March 4, but would still agree to maintain supply discipline.
“With OPEC+ endeavoring to keep global oil production below demand, inventories should continue falling this year and allow prices to rise further,” said UBS analyst Giovanni Staunovo.
Oil demand was seen growing by 5-7 million barrels per day in 2021, as per the poll.
However, experts said any deterioration in the COVID-19 situation and the possible lifting of US sanctions on Iran could hold back oil’s recovery.
Meanwhile, global demand for oilbased marine fuels is set to fall in the next three decades as stricter carbon emissions rules for the shipping industry kick in and alternative fuel use climbs, consultancy Wood Mackenzie said on Friday.
The UN’s International Maritime Organization (IMO) is set to formally adopt energy efficiency regulations in June that aim to reduce the carbon footprint of new and existing ships by 40 percent by 2030 compared with 2008 levels.
By 2050 the IMO aims to reduce the overall greenhouse gas emissions from ships by 50 percent from 2008 levels.
Adoption of the upcoming efficiency rules would achieve the IMO’s 2030 target and cause a decline in global bunker fuel demand of around 370,000 barrels per day (bpd) by 2030 compared to the current outlook, Iain Mowat, a principal analyst at Wood Mackenzie, told Reuters.
Even with these reductions, global consumption of marine fuels, currently estimated at just under 5 million bpd, is expected to grow to 5.9 million bpd by 2030, said Mowat.