Oil Price To Reach $60-80 Range Over Next Year And Half - Rice Energy Initiative Director

Oil Price to Reach $60-80 Range Over Next Year and Half - Rice Energy Initiative Director

HOUSTON (UrduPoint News / Sputnik - 16th March, 2019) US oil exports will negatively affect the price of oil in the world market and the price will range between $60 and $80 over the next one-and-a-half years, Rice Energy and Environment Initiative at Rice University Executive Director Sergio Kapusta told Sputnik on Friday.

Asked about the main oil price drivers in the near future, Kapusta said, "The main driver that I see is the growth of North American unconventionals continuing to grow and exceeding everybody's expectations."

Kapusta pointed out that oil production has been "tremendous" and given that the United States has had excess capacity the only option it had was to export.

However, the result of the United States' moving to the export market has been a downward push on prices, including US prices.

"So, I can see that's happening and that's going to have a negative push on all prices," Kapusta said.

Kapusta noted the demand side of the equation and pointed out there has not been a surge in demand.

"There were expectations that China and India will continue to grow at a very accelerating pace, but the Chinese economy has not been pulling as much oil or as much energy resources as was expected either," Kapusta said.

"So, the combination one and the other to me means prices are going to stay flat for at least a year to two years in the future."

Kapusta said he expects the oil price will stay between $60 and $80 over the next one-and-a-half years.

"My expectation is that it will continue stay in the range where it has been, which is somewhere between $60 and 80 ... at the end of this year and I would say into the next year," Kapusta said.

Oil giant BP has forecast oil prices to stand between $50 and $65 per barrel over the next there-to-four years, BP CEO Bob Dudley said in late February.

Over the last couple of years, world oil prices have been influenced by the 2016 OPEC-Non-OPEC deal on oil production cuts, which was concluded to support oil prices. On December 7, participants of the OPEC-non-OPEC 2017 oil output reduction deal agreed to reduce overall production by 1.2 million barrels per day starting in 2019, giving rise to fears that oil prices might go too high.

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