Employees torque a pipe at a wedge well at Christina Lake, a situ oil production facility half owned by Cenovus Energy and ConocoPhillips, in Conklin, Alberta, Canada.

Brent Lewin | Bloomberg | Getty Images

Employees torque a pipe at a wedge well at Christina Lake, a situ oil production facility half owned by Cenovus Energy and ConocoPhillips, in Conklin, Alberta, Canada.

Oil market is expected to see a downward correction this quarter but Brent prices will move higher in the final quarter of this year, according to a research note from Barclays.

“Prices have moved higher, due to a perfect combination of a favorable macro environment, a seasonal uptick in consumption, continued inventory drawdowns, and geopolitical unrest,” the note said. “Certain factors that supported prices in July are unlikely to last, and we expect a downward correction during this quarter.”

The report, however, forecasts Brent prices going up to $54 a barrel in last three months of the year, based on continued inventory draws, OPEC discipline, and the ongoing decline in output in Venezuela.

The report further added that during the recent market rally, prices moved higher because of a paring back of selling positions, rather than new buying trades entering the market.

“Fundamentals remain shaky this quarter, therefore any rally that occurs before more substantive inventory draws would be short-lived.”

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