World’s largest energy trader sees a decade of low oil prices
Oil prices will stay low for as long as 10 years as Chinese economic growth slows and the U.S. shale industry acts as a cap on any rally, according to the world’s largest independent oil-trading house.
"It’s hard to see a dramatic price increase," Vitol Group BV Chief Executive Officer Ian Taylor told the international news agency Bloomberg in an interview, saying prices were likely to bounce around a band with a midpoint of $50 a barrel for the next decade.
"We really do imagine a band,” probably between $40 and $60 a barrel, he said. "I can see that band lasting for five to ten years. I think it’s fundamentally different."
The lower boundary would imply little recovery for Brent crude, the global benchmark, which traded for $33.38 a barrel at 10:16 a.m. Monday on the London-based ICE Futures Europe exchange. The upper limit would put prices back to the level of July 2015, when the oil industry was already taking measures to weather the crisis.
The forecast, made as the oil trading community’s annual IP Week gathering starts in London, would mean oil-rich countries and the energy industry would face the longest stretch of low prices since the 1986-1999 period, when crude mostly traded between $10 and $20 a barrel.