Scott Darling, JPMorgan head of regional oil and gas, discusses the outlook for oil prices with Bloomberg’s Yvonne Man and Ramy Inocencio on “Bloomberg Daybreak: Asia.”
US shale production is forcasted to reach 11 million barrels per day (bpd)by end 2018.
Could that spell trouble for oil prices, when a 1 million bpd Shale growth eats away at OPEC production cuts of 1.8 million bpd?
“We foresee $70 for price of Brent oil this year, and we could see $75 for Q2,” said Darling.
“Demand is strong, and not just seasonally, and with tightness on supply especially from Venezuala, which is a particular risk.”
But what should the market be worried about?
Should we be concerned about volatility, rise in US shale production or slowdown in demand?
“The demand risk is valid, especially from the US, but fundamentals are strong,” said Darling.
In JP Morgan’s recent economic report, it indicated strong regional GDP growth, 3.5% global GDP growth and a bigger uptick of 4.9% for Emerging Markets.
“Nothing in the data says that demand will slow,” added Darling.