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By Fatma Babayeva

The oil prices that fell dramatically since mid 2014 are forecasted to rush back to previous highs only in 2040.

The U.S. Energy Department has updated its forecasts for oil prices on energy markets until 2040.

Global oil prices which fell from a high of around $115 per barrel in 2011 to $50 per barrel in 2015 will be restored in 2040 by reaching $141, analytics of the department believe.

In its forecasts, the department highlighted four fundamental factors such as investments decisions by OPEC countries, fuels market, market of non-inflammable resources, as well as, global demand for fuel and other flammable resources. Dynamics of all four factors may instantly change the balance in the oil and gas market. As a result of it, the given forecasts need to be revised, the department announced.

$141 per barrel is a forecast of high oil prices scenario, which is based on the assumption that production costs of the oil companies and countries will be reduced and demand for oil will gradually increase.

In this case, OPEC will focus on keeping its market share at 39-43 percent. In the meantime, the OECD’s demand for oil will grow from current 45.5 million barrels to 46.1 million barrels, and total demand for energy products will increase from 44.8 barrels to 74.8 million barrels of oil equivalent per day.

Low oil prices scenario forecast also projected a rise in oil prices until 2040. In accordance with this forecast, global oil prices will reach to $75 (in dollar terms of 2013). In this forecast, the Department takes into account slower economic growth and decrease in demand for fuel products.

The minimal increase in demand is expected Europe and Eurasia and non-OECD countries, including in Russia.

In its forecasts, the Department also provides its estimates for oil producing countries. Russia is expected to increase the production of the natural gas by 2040 due to the development of the fields located in the Arctic and Eastern region of the country.

The global oil prices begin to fall since mid-2014. The current oversupply problem in the global oil market is named as the main reason why the oil prices cannot recover.

It is believed the solution for the problem is that the oil producers need to cut their production. However, even talks held by these countries about freezing their production at the level of January 2016 keep failing.

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Fatma Babayeva is AzerNews’ staff journalist, follow her on Twitter: @Fatma_Babayeva

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