As a result of rising oil prices in December, the U.S. Energy Information Administration has increased its forecast for both Brent and WTI crude oil prices by $2, and now sees Brent prices averaging $53 and WTI averaging $52 per barrel this year. EIA’s January Short-Term Energy Outlook (STEO) forecasts average Brent prices at $56 and average WTI prices at $55 per barrel in 2018. Still, the oil price forecasts have very broad uncertainty bands, in line with the ranges of values of the contracts for future delivery. Contracts traded during the five-day period ending January 5, for example, suggest that the market expects WTI prices could range from $35 to $93 in December of this year. EIA’s increased forecast in the January STEO, compared to the December STEO, reflects the market reaction to the OPEC deal at the end of November, which pushed average Brent prices trading $9 […]