Low oil prices for two years - five outcomes of an $80 Brent world

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24 November 2014

Low oil prices for two years - five outcomes of an $80 Brent world

Report summary

Brent has fallen to $80 per barrel. Here, in a sensitivity to Wood Mackenzie’s base case, we illustrate five likely outcomes of two years of low oil prices. Russia is forced into recession and the geopolitical complexion of the Middle East changes. Corporates are forced to adapt, but US tight oil is resilient to lower prices. China will feel the benefits of lower prices and global economic growth will be boosted, accelerating the commodity cycle.

Table of contents

  • Executive Summary
  • Introduction - oil prices shrug off geopolitical concerns
    • Russia comes under pressure, but Putin is secure
    • The geopolitical landscape of the Middle East becomes more complex
      • Iran
      • Iraq
      • Saudi Arabia
    • Corporates will be forced to adapt
    • but US tight oil production growth is resilient
    • Energy importers will cheer
  • Conclusion – broad economic benefits and an accelerated commodity cycle

Tables and charts

This report includes 6 images and tables including:

  • Brent price required to retain current net debt levels 2015 - 2016
  • US tight oil new development volumes by breakeven ($WTI)
  • Oil import cost, US dollars
  • Oil import cost index, domestic currency
  • OPEC crude oil production capacity 2014 - 2030
  • OPEC crude oil production capacity growth 2014 - 2030

What's included

This report contains:

  • Document

    Low oil prices for two years - five outcomes of an $80 Brent world

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