Analysts are raising their forecasts for oil prices, as oversupply concerns begin to dwindle and prices rise, with oil breaking $50/barrel last Thursday for the first time since November.
Investment banks surveyed by the Wall Street Journal have raised forecasts for the third consecutive month, predicting Brent crude would average $43/barrel in 2016—up $2 from April’s survey.
The higher forecasts relieve some pressure from OPEC members after months of controversy over production levels from within the organization.
“The market is conspiring to help OPEC,” RCMA Asset Management CIO Doug King tells the WSJ. “If I was in the Saudis’ shoes right now, I’d be pretty happy right now.”
Low oil prices help boost consumer spending, helping create what Colliers principal Jack Rosenberg told Bisnow in March were some of the best conditions for industrial in the past 35 years.
On the other hand, the rock-bottom prices have slowed profits for oil-dependent firms, and have analysts closely watching the Houston office market. [WSJ]
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