Oil prices are expected to grow slightly this year.
That’s according to Andrew Botterill with Deloitte’s Resource Evaluation and Advisory group.
In their latest price forecast released Wednesday, Botterill says production cuts by members of the OPEC and other non-OPEC countries are expected to provide a short-term boost to world oil prices.
“We’ve already started to see changes of oilsands in the last month or so and that’s when the realization that the cuts suggested by OPEC were something that looks more concrete and more sure than many had assumed it might be. I think there’s a lot of optimism in the sector now that there will be extra barrels that we will be moved from the system by OPEC and non-OPEC producers and that’s going to get rid of the oversupply that’s been hanging over our heads for the last couple of years and make things more positive in 2017.”
Botterill tells Mix News for oilsands producers in the region this will mean stable prices, allowing them to be a bit more nimble and start to make decisions more effectively. But adds he doesn’t think there will be many new project start-ups here in 2017.
“Because I think producers are still trying to make sure that they manage their cost and are efficient.”
Botterill says the futures market is also showing very little increase in the price of oil as global demand growth is expected to remain relatively flat at 1.2 million barrels per day.
He predicts prices for 2017 will remain around $55 a barrel.
Of course, like other experts have predicted, Botterill says there is some optimistic news for oil producers, as the recent approvals of Enbridge’s Line 3 and Kinder Morgan’s Trans Mountain pipeline projects mean enhanced access to market for Canadian oil.