Oil prices will stay low for the next ten years over Chinese economic slowdown and the US shale industry acting as a cap on any rally, Ian Taylor, CEO of Vitol Group BV, the world’s largest independent oil-trading house, told Bloomberg in an interview. According to Taylor, prices are likely to bounce around a band between $40 and $60 a barrel. Oil majors including BP and Shell have both also said they are looking ahead to a rebalancing of the market in the second half of the year, which could support oil prices at around the $60 a barrel mark by early 2017, Telegraph reported.
The forecast, made as the oil trading community’s annual IP Week gathering starts in London, would mean oil-rich countries and the energy industry would face the longest stretch of low prices since the 1986-1999 period, when crude mostly traded between $10 and $20 a barrel.
Vitol is to report net income for 2015 above the $1.35b it earned in 2014, yet the company would not match the record of almost $2.3b of 2009. Vitol trades more than 5mb/d of crude and refined products, which would be enough to cover the needs of Germany, France, and Spain together.