Global energy markets forecast – January 2021

We are pleased to publish our latest global energy markets forecast for January 2021. Along with substantial commentary on key market movements, this quarterly update presents our latest outlook on commodities prices up to 2050.

Key highlights of the report include:

  • Brent prices are forecast to be 2% lower, at $53/bbl on average in the period 2021-2025, versus our October 2020 forecast. Even though the COVID-19 vaccine breakthrough contributed to some bullish sentiment in the market, continued demand uncertainty due to mounting infections and associated lockdowns weighed on near-term futures
  • European gas prices are expected to average 18€/MWh in the period 2021-2025, in line with our previous forecast. Despite the start of the winter heating season creating some upward pressure on prices, the appreciation in the EUR/USD exchange rate offsets the impact of increased winter demand
  • US Henry Hub (HH) gas prices are expected to average $2.4/MMBtu between 2021 and 2025, in line with our October 2020 forecast. A fresh wave of COVID-19 infections and the fast production recovery cap price upside posed by increased LNG feedgas demand
  • Asian LNG spot prices have decreased by 3% since our last report, to $7.5/MMBtu on average between 2021 and 2025, reflecting an expectation of robust and reliable supply in Asia-Pacific as the US has increased LNG output and Australia has restored LNG production at Gorgon and Prelude plants after outages
  • ARA coal prices have decreased by 2% on average between 2021 and 2025, to $56/tonne, due to decreased coal-for-power demand and a second wave of COVID-19 infections

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