Brent oil averaged more than $100 a barrel for the past three years, tripling from its 2008 low as the world economy recovered from the financial crisis.
In Shells tighter supply scenarios, crude prices could steadily increase over the next 20 years, while still going through periods of volatility that could see Brent falling to $70 a barrel, Bentham said.
While oil companies are cutting their investment plans to strengthen returns amid falling profitability, spending reductions are not the most important factor influencing the oil price, Bentham said. Increased Iranian exports as sanctions are lifted, Iraqs ability to boost its production and Libyas capacity to limit output shutdowns are factors bigger in totality than the trimming of the investments, he said.
The possibility of weakening demand growth in emerging markets may be offset by a strengthening U.S. economy, he said.
Economic development and particularly in the emerging nations, is the biggest driver of demand change, Bentham said. That has an important impact on the commodity prices.
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Too many things impact it that are way beyond reasonable predictions, wars, changes in technology, competing technology, etc.
What should be understood by the reader of long-term oil forecasts is that this only holds if nothing else changes, and that impacting change in a 20 year period is near certainty.
oil and gas prices fluctuate when needed ... the need being to oust an unfavorable American administration