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Oil Price in 2015 Not to Exceed $60 per Barrel – EBRD

In 2015, world oil prices will range within $50-$60 per barrel, a leading economist of the European Bank for Reconstruction and Development (EBRD), Dmitry Gvindadze said.

"In my opinion, this year, oil prices will remain at the same level, i.e. within the range of $50-$60 per barrel," Gvindadze said. "But it is very difficult to talk about what will happen next year or in two or three years, as there are many factors that affect the price of oil. I mean such fundamental reasons as the volumes of oil consumption, new technologies, which are used in oil production, shale gas, and so on."

Oil prices have started to drop since July 2014 when they fell from $105 to $100 and then to $80 per barrel. After OPEC member states refused to reduce the quota for oil production in November, the decrease in oil prices accelerated. The average price for oil has varied within $50 per barrel since early 2015.

However, the developments in Yemen caused increase in the prices for "black gold": the price of the May futures for the Brent North Sea oil mixture and WTI crude oil increased on Mar.26.

The increase in oil prices was related to the possibility of spread of the military activities from Yemen to the neighboring countries. The confrontation between the Houthi rebels (a Shia group) and the government in Yemen has in recent months seriously aggravated. Houthis actually have seized the power in Yemen.

In response to this, a coalition of 10 countries, including the six Gulf states, launched an operation against the Houthis.

However, many experts believe that the volume of oil production in Yemen is not so great [145,000 barrels per day], and the conflict will not go outside the country, so there is no reason to expect a rise in oil prices.

This is confirmed by the fact that on Mar. 27 the price of the May futures for the Brent North Sea oil mixture dropped to $58.22 per barrel, and the price of May futures for WTI light crude oil - to $50.43 per barrel.

In general, there is no common opinion about the oil price.

Standard Chartered Commodities Head Paul Horsnell thinks that the price on an oil barrel may rise to $100 by 2016. Iraqi Oil Minister Adel Abdel Mehdi said that the cost of an oil barrel may reach $70 by late 2015.

Russian Finance Minister Anton Siluanov thinks differently, as he said the oil price will not reach $70 per barrel in the coming years.

But Siluanov's colleague - Russian Deputy Finance Minister Maksim Oreshkin does not see the reason to raise the forecast from $50 a barrel.

Source: AzerNews

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