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The Energy Information Administration's new monthly outlook cuts a lot — $11-per-barrel! — from their 2019 average oil price forecast. They now see Brent crude averaging $61 and WTI averaging $54.
Why it matters: Analysts are often playing catch up, and the big revision is a sign of how quickly the oil market can shift, as OPEC and Russia respond to the rise of U.S. shale and analysts weigh signs of softening global demand and other forces.
- It also signals that EIA, for now, does not see the new OPEC+ production-cutting deal as putting much upward pressure on prices.
What they're saying: "Market uncertainty during November appears to have contributed to levels of price volatility for Brent and West Texas Intermediate crude oils not seen in several years," EIA administrator Linda Capuano said in a statement.
- EIA says the recent big declines in Brent prices stem from record output among the world's largest producers and concerns about weaker demand.
The latest: Crude prices are climbing Wednesday as the market responds to signs of declining inventories.
- "The American Petroleum Institute, an industry group, reported late Tuesday that U.S. stockpiles of crude oil had reduced by 10.2 million barrels last week," the Wall Street Journal reports.
Go deeper: EIA cuts Brent, WTI 2019 forecasts nearly $11/b amid supply glut (S&P Global Platts)