According to the National Bank, in the coming years, world energy prices will fluctuate, but within narrow limits and with a downward trend.
This is stated in the Inflation Report of the National Bank of Ukraine for July 2024.
Oil Prices
In 2024, world oil prices will remain at the level of $80-90 per barrel.
Now watching
However, record production volumes in the United States, a steady increase in production by Libya, Iran and Angola against the backdrop of sluggish demand from China.
Meanwhile, the expected revival of demand in the US and European countries, in particular due to the gradual easing of monetary policy by leading central banks (CB), will keep prices from falling.
Oil prices are expected to fall moderately in the coming years due to the current supply surplus on the market, including due to increased production by OPEC+ countries.
According to the report, the average price of Brent crude oil fell by 17.2% to $82.6 per barrel in 2023.
However, the NBU forecasts that in 2024 the price will rise by 1.8% to $84.1, in 2025 it will fall by 11.1% to $74.7, and in 2026 it will fall by 2.1% to $73.1 per barrel.
Prices for gas
According to the NBU forecast, natural gas prices on the European market, despite the continued high volatility, will decrease over the entire forecast horizon, in particular, due to:
- increasing LNG production in the world, primarily in the USA, Qatar and Australia;
- increasing supplies by Russia to Asian countries;
- increasing energy production from renewable sources;
- balanced accumulation of reserves.
However, geopolitical tensions will remain the main source of uncertainty.
In particular, terrorist activity by non-state entities in the Red Sea and the escalation of the war in the Middle East could create significant disruptions in energy supply chains to the world market.
Thus, in the context of the expected revival of demand, this could lead to the leveling of the supply surplus and an increase in oil and gas prices.
It is noted that gas prices at the TTF hub in the Netherlands last year fell by 65.7% to $465.6 per thousand cubic meters.
The National Bank predicts that this year prices will fall by 23.8% to $354.6 per thousand cubic meters, in In 2025 they will grow by 8.5% to $384.7, in 2026 they will fall by 12.5% to $336.5.
