Annual Report on Crude Oil: 2024 Overview and 2025 Outlook
2024 Summary: A Year of Volatility and Resilience
The year 2024 was marked by significant price fluctuations in the crude oil market. The West Texas Intermediate (WTI) crude oil price averaged $85 per barrel, while Brent crude maintained a slightly higher average of $88 per barrel. Key drivers for the year included geopolitical tensions, supply chain disruptions, OPEC+ production policies, and global economic uncertainties.
Key Events Impacting Crude Oil Prices in 2024:
- OPEC+ Production Decisions:
- Early in the year, OPEC+ announced production cuts totaling 1.5 million barrels per day (bpd) to stabilize prices. Despite concerns over demand, this policy helped sustain prices above $80 per barrel for most of the year.
- Global Economic Slowdown:
- High inflation and restrictive monetary policies in advanced economies, including continued rate hikes by the Federal Reserve, European Central Bank, and others, dampened crude oil demand.
- China’s economic growth slowed, reducing its traditionally robust crude imports.
- Geopolitical Disruptions:
- Escalating tensions in the Middle East, including an armed conflict between Israel and Hamas, raised concerns about potential supply disruptions from major producers in the region.
- Sanctions on Russian crude exports were tightened, leading to shifts in trade flows, particularly toward Asia.
- Energy Transition Policies:
- Increased adoption of renewable energy sources and stricter climate policies in Europe and North America slightly eroded crude demand.
- U.S. Shale Production:
- U.S. shale producers ramped up output by approximately 1 million bpd, partially offsetting OPEC+ cuts.
READ MORE — Will the S&P 500 Hit 6,800 by 2025? Earnings Growth Predictions
Comments