CALGARY, Alberta (Sept. 11, 2024) — Enverus Intelligence® Research (EIR), a subsidiary of Enverus, the most trusted energy-dedicated SaaS company that leverages generative AI across its solutions, has released its latest Fundamental Edge report, which focuses on global drivers for oil and gas prices through 2030, the five-year oil and gas supply and demand outlook, and price forecasts.
EIR’s 1H2024 Brent price expectations have been met. However, softer August Chinese demand coupled with U.S. recessionary fears have driven Brent prices lower. EIR dropped its 2H24 price forecast by $5/bbl but remains bullish to consensus expectations. Furthermore, EIR does not foresee a material change in OPEC intent and that the cartel will aim to maintain price stability.
“We continue to expect demand to pick up through the second half of 2024, resulting in an acceleration of stock draws leading to higher prices, assuming no recession.” said Al Salazar, report author and director at EIR. “Should markets overcome recessionary fears, market participants will face alarmingly low crude and product stock levels, steady demand gains and few sources of near-term supply growth.”
As for OPEC intent, Salazar said, “OPEC will not increase production amid current market uncertainty and risk undoing more than three years of crude and product stock management.”
Turning to natural gas, U.S. producers have once again demonstrated a very high level of price sensitivity. After significant production shut-ins in March and April, Lower 48 production bounced back after gas price rebounded to north of $3.00/MMBtu. “It felt like a game of Whac-A-Mole,” Salazar said. “Producers wacked high price moles by turning the taps on.”
Overall, natural gas markets are struggling to find a balance between frothy storage levels, strong Y/Y gas-fired generation growth and lightning-quick producer reflexes to positive price signals. “The only call here in the near-term is for extreme price volatility,” Salazar commented.
EIR remains bullish about gas prices in 2026 and 2027 as the impressive LNG buildout will require higher gas prices to motivate energy companies to boost production.
Key takeaways from the report:
- EIR downgraded its oil and gas price forecasts for the second half of 2024.
- EIR’s oil price view is still bullish to the forward curve despite the $5/bbl cut to its 2H24 Brent price forecast.
- EIR remains bullish gas in the 2026-27 period as producers need to be incented growth production into the LNG liquefaction growth surge.
EIR’s analysis pulls from a variety of Enverus products including Enverus Intelligence® Research.
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About Enverus Intelligence® Research
Enverus Intelligence ® | Research, Inc. (EIR) is a subsidiary of Enverus that publishes energy-sector research focused on the oil, natural gas, power and renewable industries. EIR publishes reports including asset and company valuations, resource assessments, technical evaluations and macro-economic forecasts; and helps make intelligent connections for energy industry participants, service companies and capital providers worldwide. EIR is registered with the U.S. Securities and Exchange Commission as a foreign investment adviser. Enverus is the most trusted, energy-dedicated SaaS company, with a platform built to create value from generative AI, offering real-time access to analytics, insights and benchmark cost and revenue data sourced from our partnerships to 95% of U.S. energy producers, and more than 40,000 suppliers. Learn more at Enverus.com.
Media Contact: Jon Haubert | 303.396.5996
