Executive Summary: Oil market outlook
Oil prices have risen since OPEC’s decision at its November meeting to re-establish a cap on production, and some non-OPEC members agreeing to cut output. The move is expected to speed up the rebalancing of the global oil market in 2017. Nevertheless, higher prices will promote oil output in the United States, which could reduce the effect of OPEC’s move.
Consequently, the Brent crude front-month futures price has averaged $54.5 per barrel so far in December, an increase of $7.4/bbl from November. Meanwhile, the front-month futures price for WTI crude has risen by $5.7/bbl, to average $51.5/bbl. GGA expects the Brent price to average $53/bbl in 2017.