Brent crude prices, the benchmark for half the world’s oil, will weaken for a second year in 2014 as U.S. output expands and threats to Middle East and North African supply ease, the most-accurate forecasters said.
Even with OPEC forecast to keep its output quota unchanged at a meeting this week, falling oil demand and prospects for increased supply from some member states mean the group’s leader, Saudi Arabia, will have to cut production anyway.
OPEC will keep its crude production limit unchanged next week as it anticipates demand in line with its current target, and as members struggle to agree on their individual share of the total, according to a Bloomberg survey.
The U.S. will surpass Russia and Saudi Arabia as the world’s top oil producer by 2015, and be close to energy self-sufficiency in the next two decades, amid booming output from shale formations, the IEA said.
OPEC acknowledged it underestimated the significance of the North American energy boom as it tripled estimates for shale oil produced there and predicted a decline in demand for its own crude through to 2018.