Wall Street insiders believe that there is some room for recovery in international oil prices next year, but the magnitude of the rebound may not be significant.
The average predicted price for Brent crude oil by five major US banks in 2024 is approximately $85 per barrel, with Citigroup predicting the lowest price at $75 per barrel and Goldman Sachs offering the highest price at $92 per barrel. By comparison, the price of oil as of publication is $77 per barrel.
Currently, it is widely expected that global oil demand will further increase in 2024 on the basis of record levels set this year, which has also been recognized by the Organization of the Petroleum Exporting Countries (OPEC) and the International Energy Agency (IEA).
However, analysts still have differences on the extent of demand expansion, the degree of supply increase, and whether supply can meet demand. Overall, their emotions are more cautious than at the beginning of the year, when there were voices predicting that oil prices would return above $100.
But what ultimately happened was that the unexpectedly strong production of non OPEC countries such as the United States and Guyana thwarted these bullish calls. Last December, Citigroup believed that the average oil price this year was $80 per barrel, which proved to be the closest to the actual result.
The latest prediction from the bank is that the oil market will tend towards overcapacity next year, due to the dual constraints of global oil demand being constrained by economic headwinds and energy transition, as well as strong supply from the United States, which requires OPEC+to further reduce production in order to barely support current levels of oil prices.
Max Layton, head of commodity research at Citigroup, told the media, "OPEC has the ability to maintain market unity, and we expect prices to stabilize."
Morgan Stanley analyst Natasha Kaneva expects the average oil price next year to be $83 per barrel, Morgan Stanley analyst Martijn Rats believes it will be $85 per barrel, and Bank of America's Francisco Blanch is $90.
The Goldman Sachs team, which holds the most optimistic view, predicts that global oil demand will increase by 1.6 million barrels per day next year, while core OPEC member countries will firmly control supply, which will cause a moderate "supply shortage" in the global market.
Previously, OPEC predicted a strong growth of 2.2 million barrels per day in global oil demand next year, while the International Energy Agency's growth rate was only half, at 1.1 million barrels per day.