Oil prices are rising again after a drop on Friday. Brent futures for October rose by 0.83% to trade at $45.17 per barrel, moving from the close of the previous session. At the same time, WTI oil futures for September went up by 0.98% to settle at $42.42 per barrel.
By the end of the week, Brent added 0.9%, while WTI rose by 1.9%. The market was supported by the data showing a drop in US oil inventories for the third week in a row.
Meanwhile, the US and China have postponed trade negotiations scheduled for August 15, thus disappointing investors. However, AxiCorp analyst Stephen Innes believes that the large volume of US oil imports to China is the most obvious confirmation of the trade deal.
According to experts from BofA Global Research, at the end of 2020 there will be a shortage of oil in the market. In this regard, the price of Brent oil may surge to as high as $60 per barrel in the first half of 2021.
Analysts expect that investors will gain confidence from the OPEC+ compliance with the terms of the current agreement on output cuts. In addition, US shale production will decline, and the recovery in global oil demand will be sustained.
If these factors persist, then the global oil market may face a shortage of 4.9 million barrels per day. Thanks to this, the price of Brent can easily rise to $60 per barrel next year, experts say.
Moreover, according to some reports, global oil reserves are reducing faster than expected. They have almost returned back to normal levels.
The BofA forecast is based on the assumption that the world will be able to avoid a massive second wave of the coronavirus pandemic in the fourth quarter of 2020.