As we approach the close of 2020, we’re reminded of one statistical certainty when it comes to oil price predictions. If you set anything other than a range, you will be proven wrong. And even for the forecasters and predictors that do set a range, the likelihood that the actual price will fall within the chosen range is about as sure as a range of prices selected by throwing a dart at a number on the wall. That has never stopped oil price forecasters from giving it a go.
We’ve rounded up some of our favorite oil price predictions from this year. And while you’re thinking that this might not be a fair exercise given the black swan event such as the coronavirus pandemic, we will remind you that the predictions made even in the middle of the pandemic were quite suspect.
The U.S. Energy Information Administration (EIA) has the unfortunate position on our list of going first. Its January prediction for 2020 oil prices for both WTI and Brent would later prove to be high–not unsurprisingly given the events that were about to unfold. While there were reports that an outbreak was brewing as early as the first few days of January 2020, it wouldn’t be until January 13 that the first Covid-19 case was known to have escaped China’s borders. But when the EIA published its STEO on January 14, cratering oil demand due to the future pandemic wasn’t even on its radar. What was on its radar? Tensions between the United States and Iran, and the corresponding fear that there would be some oil supply disruption in the Middle East.
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