The most stable oil price measured by some analysts is the WTI oil price. According to the CBOT prices, WTI oil price was trading at $54.69 per barrel at the time of publication of this article.
On October 5, 2017, the Saudi Arabian Energy Minister Khalid al-Falih said that OPEC and non-OPEC members will continue to control oil supply to stabilize prices. Additionally, he explained that the agreement was to “overhaul” the market and that the agreement should remain in place until the end of 2018. However, the price of oil did not change to the level expected by OPEC. Some analysts claim that oil price was hurt by global demand slowdown, recent oil discoveries, fears about crude spill in Iraqi Kurdistan and concern that the OPEC cut will not be extended.
On September 20, 2017, OPEC delivered a surprise. The cartel decided to extend its oil supply cuts until the end of 2018. Despite the concerns about the impact of the OPEC agreement on global demand, oil prices jumped by more than 1% to the highest level in more than three months. Some analysts noted that OPEC decision would help increase oil prices to a level at which U.s. shale producers will not be able to offset the supply deficit. However, the current oil price does not seem to give enough support for companies to increase production.

What is the price of oil expected in 2018?

The price of oil is sensitive to a few factors. While some analysts predict that global demand will increase, the non-oil industry is worried about a global economic slowdown. The price of oil should increase to meet the demand as a lower oil price would increase the demand for oil products. such as gasoline, jet fuel, and diesel fuel. Oil would be transported by sea, and the cargo transportation costs would be increased due to the transportation costs of freight oil. As a result, the price of oil would increase due to rising demand.
According to the analysts, the WTI oil price will continue to increase. For example, according to the EIA, global demand for oil products increased by 2.8 million barrels per day in 2016. The energy agency expects global demand to increase by 1.7 million barrels per day. And in 2017 and 1.3 million barrels per day in 2018.

The demand for oil products varies significantly across regions.

For example, the energy agency expects the demand for diesel and jet fuel in North America and Europe to increase in 2018, while demand in China will decrease. Additionally, some analysts expect that oil prices will be stuck at a level in which energy companies do not find enough crude oil to cover the production cost. According to the consultancy Fitch, oil prices will be higher in 2018 and 2019.

Nevertheless

Nevertheless, the demand for oil is sensitive to several factors. The global oil demand may decrease due to a slower economic growth in several major economies. Energy consumption growth would decline in Europe, China, and the United States. In addition, prices would decline in 2017 due to the recent low oil prices. Therefore, oil companies may increase the production cost and stop production in order to cover the production cost. Therefore, the prices of oil will be low in 2018, and energy companies may not increase production to meet the demand as a result

What is the probability of a positive oil price in 2018?

Estimates suggest that the oil price will be increased by $10 per barrel to more than $60 per barrel. According to the energy analysts at the IEA. The supply of oil is expected to increase to meet the expected increase in global demand in 2017. In addition, some analysts forecasted that OPEC would produce more oil in 2017. Furthermore, the oil demand is expected to increase in 2018 and 2019.

higher oil prices

On December 22, 2016, the U.S. Energy Information Administration revised the demand forecast for 2017 upward by 200 thousand barrels per day. This adjustment brought the global oil demand to the level of 102.5 million barrels per day. The EIA estimated that the global oil demand is expected to increase by 1.2 million barrels per day in 2018. The energy agency expects that oil prices will increase to reach the level of $62 per barrel in 2018.
The expectation of higher oil prices is due to the weakening of oil prices. If oil prices increase to a level that some analysts predict. The energy company would increase their production in order to meet the demand. Thus, the oil production cost would increase. According to the Energy Agency, the oil production cost in 2016 was approximately $26 per barrel. And the cost in 2017 is estimated to increase to $28 per barrel. If energy companies increase the production cost to $38 per barrel in 2018. The energy company would find oil to cover the cost as a higher oil price would help oil companies increase the production cost. Therefore, the energy agency expects that the price of oil will increase to reach a level that some energy companies find adequate to cover the production cost.