Oil Prices Predicted to Decline This Year
Crude oil prices have been on a rollercoaster ride. After trading above $80 per barrel until late last year, earlier this year OPEC+ predicted that a significant decline in demand and an increase in supply would occur in 2025 which would likely bring oil down.
Worse-than-expected reciprocal tariffs from the US have raised demand concerns. However, OPEC+ only added to these concerns by announcing a larger-than-expected supply increase for May.
Based on the current production plan, OPEC+ will gradually bring back an additional 2.2 million bpd to the market from April 2025 to September 2026. The supply increase for April is 138,000 bpd, while the group intends to increase supply by a further 135,000 bpd for May.
However, the group surprised the market after a video conference between members on Thursday, where it is thought the main topic of discussion was ensuring that members adhere to their production targets. The group announced that it would increase oil supply by 411 thousand barrels of oil per day in May.
This increase follows what Donald Trump has done after he was elected President of the United States where he has reversed all the steps that Joe Biden has taken to cut production and asked all US oil reserves to be filled. Therefore, in the long term we may be shown a decline in crude oil prices.
Source : (mrv@Newsmaker)
