Crude oil: Brent could move between $60 and $70, may decelerate further in 2020 - BBVA

According to the Research Department at BBVA, short-term risks are now tilted to the downside regarding crude oil prices. They see Brent Futures moving between $60 and $70 in 2019.

Key Quotes: 

“OPEC+ decision to reduce output prevented prices from declining further. The expiration of import waivers of Iranian oil could have a positive effect on Prices. U.S. production is expected to remain robust through the year. Demand is projected to slow down as global economic growth weakens.”

“We maintain our forecasts of convergence to long-term equilibrium around $60/b. Elevated uncertainty around long-term equilibrium: CAPEX, protectionism, alternative energy sources, EM convergence, EVs, climate change, efficiency and technology.”

“Prices could move between $60/b and $70/b in 2019, but may decelerate further in 2020. We maintain our forecasts of convergence to long-term equilibrium around $60/b.”