MURKY FUTURE: Energy Agency Claims the Outlook for Oil Prices ‘Only Getting Murkier’

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Is oil being pushed out of the energy market?

LONDON — The outlook for oil prices is still uncertain after the sharp fall that began last summer, the International Energy Agency said on Wednesday.

Given the price collapse, “one might be hoping for more clarity on supply and demand,” the agency acknowledged in its monthly Oil Market Report, which was released on Wednesday. “Yet in some ways, the outlook is only getting murkier.”

Oil prices, which have fallen about 50 percent since June, rose after the report. The international benchmark, Brent crude, was up about 2 percent on Wednesday, to $59.60, while its American counterpart jumped more than 3 percent to about $55.

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The agency’s report reflects a broad debate inside and outside the oil industry about where prices might eventually settle.

Citigroup, for one, expects prices to continue falling in the coming months, as output remains high, supply is building up and investors who had helped prop up prices begin to sell.

“While prices have held relatively firm, there are significant signs of weakness ahead,” Citigroup said in a note to clients on Tuesday.

Royal Dutch Shell, the oil giant that announced an almost $70 billion takeover of the British oil and gas producer BG Group last week, is expecting prices to recover much of their recent drop over the next few years. It projects prices to hit $90 a barrel in 2018.

Read more: NY Times

 

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