The outlook for an increase in the price of a barrel of oil at least through this year is anything but rosy.
Prices won’t rise much over the next 1.5 years as demand growth slows and refiners comfortably meet gasoline consumption, the world’s largest independent oil-trading house tells Bloomberg Television.
“I cannot see the market really roaring ahead,” Vitol Group Chief Executive Officer Ian Taylor said. “We have a lot of oil in the system, and it will take us considerable time to work that off.”
Since rallying from a 12-year low of $27.10 a barrel in January, Brent crude has been hovering around $50 a barrel for the last month. The international benchmark will probably end the year “not too far away from where we are today” and rise to about $60 by the end of 2017, Taylor said.
The forecast, which coincides with a similar view from Goldman Sachs Group Inc., would mean oil-rich countries and the energy industry face a prolonged period of low prices, more akin to the 1986 to 1999 downturn than the swift recovery after the 2008 financial crisis. Vitol trades more than 6 million barrels a day of crude and refined products -- enough to cover the needs of Germany, France, Italy and Spain together -- and its views are closely followed in the energy market.
Brent crude fell to $47.97 a barrel in London at 4:43 p.m. local time, down $2.13. In New York, West Texas Intermediate, the U.S. benchmark, fell 4.5 percent to $46.77 a barrel.
Read the Bloomberg TV story here.