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Crude Oil Price Forecasts

1Q 2020 –

  • While OPEC and several partner countries, namely Russia, agreed in early April to unprecedented production cuts that last through April 2022,
    BTU Analytics expects pricing to remain low in the near term as crude storage fills, both in the US and abroad. This lack of available storage
    capacity will continue to cause volatility in oil prices, such as the negative WTI pricing seen on April 20th. With global crude demand expected
    to recover slowly throughout 2020 and 2021, BTU Analytics expects WTI pricing to remain below $30/bbl for the remainder of 2020 and below
    $40/bbl for much of 2021.
  • As US storage fills over the next several weeks, in-basin pricing is expected to widen significantly to benchmark US crude pricing to encourage
    producers to curtail volumes that have nowhere to go. This has already surfaced in the Rockies, where storage is nearly completely full. In-basin
    pricing is modeled to fall to historic lows over the next several months, and could potentially fall below zero. As storage is slowly worked off in
    the second half of 2020, in-basin pricing is modeled to slowly tighten and lead to a reduction in production curtailments.

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