The outlook for oil — and maybe Oklahoma’s oil-heavy economy — is not bright.
A midyear forecast from Oil and Gas Journal shows global oil demand growth easing up as the global economy slows amid concerns over an escalating trade war between China and the U.S.
"From the forecast based on the model, we can see that oil prices will trend down from now. So, this is not good news," said Oil and Gas Journal Senior Editor Conglin Xu.
Oil prices are currently around $55 a barrel, but the forecast sees them sliding below $50 around the start of 2020.
Xu says January 2019 to May 2019 was the worst stretch for oil demand growth in more than a decade.
"Oil demand has increased only 0.5 million barrels per day, year-to-year. So, this is the slowest increase for this period since 2008," Xu said.
A drop in oil prices would likely precede a decrease in oil rigs. The number of oil rigs typically dips within a few months of prices taking a tumble.
"We can predict the U.S. oil production may slow down because of the lower rig count," Xu said.
U.S. crude oil production is up about 1.3 million barrels a day this year but may increase less than 1 million barrels per day in 2020. It ramped up by roughly 1.5 million barrels a day from 2017 to 2018.
