The reasons beyond oil decline in 2018
The first reason is standard production levels in oil production, where OPEC production has risen led by Saudi Arabia to levels not seen in Saudi Arabia from two years.
US production reached 11.3M barrels per day, and Russian production reached 11,4M barrels per day.
USA exemptions for 8 countries after imposing sanctions against Iran to import oil temporarily, therefore Iran’s exports don’t reach 0.
supplies of rock WTI in US has increase by 400 thousand barrels per day on monthly basis.
Oil prices forecast for 2019
International Monetary Fund has decreased global economic growth forecast to 3.7% instead of 3.9%.
This decline in global economic activity will lead to a retreat in demand for energy products as demand from China, the largest importer, because of slow growth in Beijing.
As warned by International Energy Agency of weak demand in Europe and developed Asia.
In addition to lower demand in India, Brazil and Argentina because of weak currencies.
OPEC expects demand for its production to drop to 1M bpd compared to 2018.
US curde leap, where the united States become the word largest crude producer in December 2018, surpassing Russia and Saudi Arabia and the US rocky oil leap.
The crisis of emerging markets and trade disputes may negatively affect global demand as well as increase supply due to increased non OPEC production.
All this will lead to expectation not to increase oil prices in 2019.