LONDON (Nov 14): The oil market has entered a new era with lower Chinese economic growth and booming U.S. shale output, making a return soon to high prices unlikely, the West's energy watchdog said on Friday.
The International Energy Agency, which typically refrains from predicting oil prices, said in its monthly report that prices could fall further in 2015 after declining to their lowest levels since 2010 below $80 per barrel.
"While there has been some speculation that the high cost of unconventional oil production might set a new equilibrium for Brent prices in the $80 to $90 range, supply/demand balances suggest that the price rout has yet to run its course," the IEA said.
Barring any new supply disruption, "downward price pressures could build further in the first half of 2015", it said.
For 2015, the IEA left its forecast of global oil demand growth unchanged at 1.13 million from a five-year annual low of 680,000 bpd in 2014, saying the macroeconomic backdrop was expected to improve.