Forecast Update - November 2024
Update of Brent and WTI forecasts.
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At the beginning of each month, we will be sending you an email like this with an updated forecast of energy prices. Commodia brings together top academic economists who specialize in the analysis of global energy markets. The team has more than 20 years of experience from leading universities across the United States, Canada, Europe, and the Asia Pacific. Our forecasts are based on state-of-the-art forecasting techniques to predict energy commodity prices.
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🛢️Oil Market - October Summary
In October 2024, oil prices fluctuated significantly due to global market dynamics and geopolitical tensions. Brent crude prices initially fell, averaging $74 per barrel in September, influenced by demand concerns and OPEC+ production adjustments. However, escalating conflicts in the Middle East pushed Brent prices up to $79 per barrel by early October.
Despite this surge, prices eased later in the month, with Brent futures dropping to $71.50 per barrel as geopolitical risks appeared to stabilize and crude supplies increased. OPEC+ also delayed an output rise, adding to the month’s price volatility.
🟧 Commodia - Forecast Update of Brent
📈 Comparison of Commodia Forecast vs. ICE Future Price
In November 2024, Commodia forecasts Brent crude oil at $76.56 per barrel, which is 0.5% higher than ICE's forward price of $76.20 per barrel. By February 2025, Commodia anticipates a price of $77.38 per barrel, approximately 3.7% higher than ICE's forward price of $74.59 per barrel.
By May 2025, Commodia's forecast rises to $78.56 per barrel, which is 6.5% higher than ICE's forward price of $73.80 per barrel. In November 2025, Commodia projects $79.87 per barrel, 10.2% higher than ICE's forward price of $72.46 per barrel.
Looking further ahead to November 2026, Commodia forecasts a price of $84.22 per barrel, which is 17.3% higher than ICE's forward price of $71.82 per barrel.
🟥 Commodia - Forecast Update of WT
📈 Comparison of Commodia Forecast vs. NYMEX Future Price
In November 2024, Commodia forecasts WTI crude oil at $72.67 per barrel, which is 0.6% higher than NYMEX's forward price of $72.25 per barrel. By February 2025, Commodia anticipates a price of $74.68 per barrel, approximately 5.8% higher than NYMEX's forward price of $70.56 per barrel.
By May 2025, Commodia's forecast rises to $75.64 per barrel, which is 8.3% higher than NYMEX's forward price of $69.86 per barrel. In November 2025, Commodia projects $76.63 per barrel, 12.1% higher than NYMEX's forward price of $68.35 per barrel.
Looking further ahead to November 2026, Commodia forecasts a price of $79.52 per barrel, which is 18.8% higher than NYMEX's forward price of $66.89 per barrel.
🗝 Key drivers of Commodia’s crude oil forecast from the previous month
The main variables influencing Commodia's crude oil forecast (Brent and WTI) are global fuel consumption, global economic conditions, and OECD petroleum inventories. The main change in our forecast from October is the surge in global economic conditions, which has put upward pressure on our oil price forecasts (1.96% increase in WTI and 1.49% in Brent).
The main determinants of Global Economic Conditions are shown in the figure below:
Chart of Main Drivers of Global Economic Conditions from Christiane Baumeister & Dimitris Korobilis & Thomas K. Lee, 2022. "Energy Markets and Global Economic Conditions" The Review of Economics and Statistics, 104(4), 828-844.
The main determinants of Global Economic Conditions are shown in the figure above for the period January 2020 to September 2024.
For more details about the Global Economic Conditions index visit: https://sites.google.com/site/cjsbaumeister/research
References
International Energy Agency (IEA). (2024). Oil Market Report - May 2024.
U.S. Energy Information Administration (EIA). (2024). Short-Term Energy Outlook - May 2024.
BNN Bloomberg. (2024). Oil Markets Look ‘Reasonably Well Supplied’ in 2024.
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Commodia Team