Cautious Deloitte forecast calls for lower oil, flat natural gas prices

CALGARY – A new forecast by Deloitte paints a bearish picture for energy prices, with oil expected to dip and natural gas to stay relatively flat.

The financial services firm predicts West Texas Intermediate prices will be US$95 per barrel for 2014, dropping to US$90 the following year and US$85 by 2018.

It sees natural gas prices on the New York Mercantile Exchange at US$4.10 this year, rising to US$4.15 in 2015 and staying flat as far out to 2021 and 2022.

In a commentary, the report’s authors say increased U.S. oil production is likely behind the lower forecasted oil prices.

Andrew Botterill and Kyle Christie say price increases for natural gas will be small at best unless consumption increases or new export markets open up.

They say the lacklustre outlook means oil and gas companies must plan with caution.