World oil prices will fall to $70/barrel by the end of 2024: Moody’s Analytics

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Global oil prices are expected to fall to nearly $70 a barrel by the end of 2024, Moody’s Analytics said in a recent Asia-Pacific (APAC) report.

Highlighting oil prices rising to $120 a barrel in June after Russia invaded Ukraine and falling to $100 a barrel in August, Moody’s Analytic said, “This trend will continue; we expect crude prices to fall to near $70 a barrel by the end of next year.”

“For major oil importers in APAC, including Singapore and Hong Kong, this will ease severe price pressures,” Moody’s Analytics said.

According to Moody’s Analytics, the impact of rising oil prices has been varied for the APAC region.

“For net energy importers such as Thailand, Japan, South Korea and Singapore, household energy bills have risen sharply. But for the region’s major energy exporters, Indonesia, Malaysia and Australia, households were more sheltered,” the report noted.

But coal and natural gas prices remain stubbornly high.

Large liquefied natural gas (LNG) importers in the APAC region, including Japan, South Korea, Taiwan and China, are particularly vulnerable to price stickiness.

Likewise, with high coal prices, major importers including India, Pakistan and Vietnam are paying more for what they need, Moody’s Analytics said.

Although higher commodity prices are hurting households and adding to global inflationary pressures, some APAC exporters are benefiting from the price premium.

Indonesia and Malaysia are the major oil exporters in the region. Rising crude prices gave everyone a rise in export prices.

Similarly, Australia is in the midst of an export boom, with high coal and LNG prices pushing its terms of trade to a record high. This not only helps Australian mining-related businesses, but also government revenue through tax revenue and corporate profit royalties.

Conversely, energy importers such as South Korea and Japan saw their import prices jump far more than their exports, causing their terms of trade to collapse, Moody’s Analytics said.

Rising import costs are putting downward pressure on the region’s major currencies, exacerbating weakness due to widening interest rate differentials with the United States.

–IANS

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(Only the title and image of this report may have been edited by Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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