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Oil Price Forecasts, Petroleum Crude Oil Forecasts

Economists analyze historical market situations and current trends to make oil price forecasts. These predictions give an insight into future oil market scenario and helps as a reference to devise appropriate energy policies.

Factors Determining Oil Price Forecasts

Oil price forecasts are influenced by the following factors:

  • Supply: The supply side in an oil industry is regulated by major oil producing nations such as Russia, Saudi Arabia, and the US. The OPEC (Organization of Petroleum-Exporting Countries) also plays an important role. The International Energy Agency 2008 report (IEA) anticipates a substantial increase in global oil production in the coming decades. It predicts additional production of 4 million barrels each day, with the discovery and harnessing of new oil fields.


  • Demand: While the supply side is monopolized by a handful of oil-producing countries, its demand curve spans the entire world population. In 2008, the world’s daily oil consumption totaled to 89.9 million barrels. The IEW expects this figure to rise by 1.6% each year. An increase in the energy consumption of developing nations in Asia, Latin American and the Middle East further escalates the demand much further.


    • In addition to the international demand and supply chain, other factors also affect oil price forecast and these are:

    • Political scenarios in oil producing nations


    • International economic health


    • Oil trade flow


    • Transportation charges


    • Refining costs

    Oil Price Forecasts: 2008 - 2030

    The data from the International Energy Outlook 2008 by the US government indicates that crude oil will account for 33 percent of the world’s total energy consumption by 2030.

    The coming decades will be characterized by oil price hikes due to:

    • Rising cost of exploration and refining, energy demand in non-OECD nations.


    • Weakening of the US dollar.

    Two different curves are predicted in the report for the oil price hikes. Firstly, it considers references to price patterns in recent years. Based on previous patterns, it is expected that oil prices will reach $113 per barrel (after adjusting to inflation) in 2030. The second case measures the oil price index in extreme situations, such as if the demand soars beyond proportions. In this situation, the oil prices will fall in the vicinity of $186 per barrel (inflation adjusted).

    Growing global demand for oil is something the 2008 report has considered while predicting that oil production is expected to rise above 110 million barrels per day.