Trafigura Forecasts End of "Lower for Longer" Crude Era
Trafigura Forecasts End of "Lower for Longer" Crude Era

Trafigura Forecasts End of "Lower for Longer" Crude Era

Trafigura Forecasts End of "Lower for Longer" Crude Era

The age of persistently weak oil prices is nearing its end, with demand booming and a supply squeeze in the offing, the world's third-largest trading house Trafigura Group announced.
"The global market could face a shortage by 2019," Ben Luckock, co-head of Group Market Risk at the independent oil trader, said at the S&P Global Platts APPEC event on Tuesday.
"As much as 9 million barrels a day of supply could be lost to crude-well declines by 2019, and the company is bullish on demand," he added, especially in India, the world’s fastest growing oil consumer, Bloomberg reported.
 “We are nearing the end of ‘lower for longer’ oil,” Luckock said, referring to a term used as far back as April 2015 by BP Plc boss Bob Dudley as a global glut wreaked havoc on crude prices worldwide.
The forecast was made as the who’s who of the oil industry gathered in Singapore for the annual Asia-Pacific Petroleum Conference, where participants turned bullish and executives pointed to strong demand and falling inventories.
If proven right, it would brighten the outlook for Big Oil, which since 2015 has tightened its belt to weather the crisis, and help crude-rich countries, potentially affecting local equities, sovereign bonds and currencies.
Trafigura’s view that demand is set to outstrip supply mirrors Citigroup Inc., whose global head of commodities research said a market squeeze may emerge as early as 2018. Strong economic growth is boosting oil consumption well above historical levels, according to BP, while OPEC and its allies curb output.
A surge in US shale production that spurred the Organization of Petroleum Exporting Countries to pump at will to defend its market share exacerbated a market oversupply over the past three years, driving the biggest price crash in a generation.
OPEC has this year changed tack by curbing output in a bid to reduce the glut.


Short URL : https://goo.gl/LuXXen
  1. https://goo.gl/Kg8UJn
  • https://goo.gl/9eMJfK
  • https://goo.gl/UKLbom
  • https://goo.gl/QXk1rm
  • https://goo.gl/EqNGm6

You can also read ...

Iran to Tap International Banks for Energy Finance
Domestic water and power plans are expected to draw a total of...
China Can Substitute US Crude With Iranian Oil
Beijing’s retaliatory measures against US tariffs can include...
Exxon to Build LNG Terminal in Australia
ExxonMobil plans to develop a project to import liquefied...
Goldman kept its forecast that Brent Crude will hit $82.50 a barrel this summer and end 2018 at $75 per barrel.
Despite expectations that OPEC and Russia will likely decide...
Japan Accelerates Plan for Restoring Gas Supply
Japan’s Osaka Gas Company said on Tuesday it would bring...
NIOC Needs to Maintain Current Output, Exports
Despite the US-Saudi Arabia ploy to coerce OPEC members' to...

Add new comment

Read our comment policy before posting your viewpoints