AM Bank Research chief economist Anthony Dass expects Brent oil to average at around the US$65 to US$69 levels in 2019.
Another economist from a local investment bank has made a more conservative forecast of US$60 per barrel, describing the projection as “playing safe”.
However, Singapore-based Oanda Corp head of trading for Asia-Pacific Stephen Innes is more positive on oil price prospects, with a forecast of US$70 to US$75 per barrel in 2019.
Not only that, earlier in October, S&P Global Ratings revised its Brent crude forecast for 2019 to US$70 per barrel, up from its initial estimate of US$65.
However, the rating agency pointed out that supply concerns remain elevated moving into next year.
Innes cautioned that a continued fall in crude oil prices would weigh on Malaysia’s budgetary and fiscal concerns. He also said that lower oil prices would be a negative driver for the already-weakening ringgit.
“Combined with policy divergence between Bank Negara and the Federal Reserve, I suspect the ringgit could trade at RM4.25 per greenback by end-2019,” said Innes in an e-mail interview.
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