At the end of 2023, prices for oil futures benchmarks Brent and WTI fell by 10%, dropping to their lowest level since 2020. This is reported by Reuters.
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On the last trading day of 2023, December 29, the price of Brent crude oil was $77.04 per barrel, while WTI was at $71.65 per barrel. In both cases, prices fell by more than 10% relative to 2022, in which oil prices rose.
The geopolitical situation and concerns about oil production led to heated trading in 2023, cementing the decline in prices in end of the year.
Oil production in the United States decreased slightly in October 2023 to 13.248 million barrels per day.
OPEC+ reduces production by about 6 million barrels per day, which is about 6 % of global supply.
Forecast for 2024
Brent crude will average $82.56 in 2024, down from a November forecast of $84.43, according to a Reuters poll of forecasts from 34 economists and analysts, as they expect weak global economic growth to limit oil demand. Geopolitical tensions may support prices.
Experts doubt the ability of OPEC countries to comply with agreements to reduce oil production. As predicted, OPEC will face weakening demand for its oil in the first half of 2024.
After a decrease in production volumes and Angola's exit from the OPEC organization, it is reducing its share in the world market.
On the world market prices will also be affected by the geopolitical situation in the Middle East. Attacks on a ship in the Red Sea forced large companies to think about an alternative Suez Canal across Africa.
The Ministry of Finance wrote that as a result of negotiations on June 4, 2023, OPEC+ countries agreed on a reduction in oil production by 1.4 million barrels per day from January 1, 2024.