5 Oil And Gas Predictions For 2021 |

2021.03.18 14:09


Sign Up To Our Free Newsletter

Join Now

Thanks for subscribing to our free newsletter!


Home Oil Prices Rig Count Energy Energy-General Oil Prices Crude Oil Heating Oil Gas Prices Natural Gas Coal Company News Interviews Alternative Energy Nuclear Power Solar Energy Hydroelectric Renewable Energy Geothermal Energy Wind Power Fuel Cells Tidal Energy Biofuels Environment Global Warming Oil Spills Geopolitics Africa Asia Europe Indonesia International Middle East North America South America Video Breaking News Premium Articles Community Trade Now My Account Latest Discussions Energy General Oil Stocks & Prices Other Energy Topics Trade Now Get Exclusive Intel All Prices OPEC Blends Canadian Blends U.S. Blends WTI Crude 10 mins Sell Buy 63.82 -0.78 -1.21% Brent Crude 10 mins Sell Buy 67.17 -0.83 -1.22% Natural Gas 10 mins 2.498 -0.030 -1.19% Mars US 11 hours 64.85 -0.25 -0.38% Opec Basket 2 days 66.89 -1.29 -1.89% Gasoline 10 mins 2.034 -0.013 -0.64% Louisiana Light 2 days 66.97 -0.69 -1.02% Louisiana Light 2 days 66.97 -0.69 -1.02% Bonny Light 1 day 66.20 -0.70 -1.05% Mexican Basket 2 days 63.29 -0.73 -1.14% Natural Gas 10 mins 2.498 -0.030 -1.19% Click Here for 150+ Global Oil Prices

Click Here for 150+ Global Oil Prices

Click Here for 150+ Global Oil Prices

Marine 1 day 66.76 +0.38 +0.57% Murban 1 day 67.44 +0.19 +0.28% Iran Heavy 1 day 62.64 -0.54 -0.85% Basra Light 1 day 67.95 -0.28 -0.41% Saharan Blend 1 day 66.28 -0.31 -0.47% Bonny Light 1 day 66.20 -0.70 -1.05% Bonny Light 1 day 66.20 -0.70 -1.05% Girassol 1 day 66.76 -0.58 -0.86% Opec Basket 2 days 66.89 -1.29 -1.89% OPEC Members Monthly Click Here for 150+ Global Oil Prices

Click Here for 150+ Global Oil Prices

Click Here for 150+ Global Oil Prices

Canadian Crude Index 1 day 54.03 -0.17 -0.31% Western Canadian Select 7 hours 53.43 -0.17 -0.32% Canadian Condensate 7 hours 63.63 -0.17 -0.27% Premium Synthetic 7 hours 65.03 -0.17 -0.26% Sweet Crude 7 hours 61.98 -0.17 -0.27% Peace Sour 7 hours 60.58 -0.17 -0.28% Peace Sour 7 hours 60.58 -0.17 -0.28% Light Sour Blend 7 hours 61.38 -0.17 -0.28% Syncrude Sweet Premium 7 hours 66.73 -0.17 -0.25% Central Alberta 7 hours 60.88 -0.17 -0.28% Click Here for 150+ Global Oil Prices

Click Here for 150+ Global Oil Prices

Click Here for 150+ Global Oil Prices

Louisiana Light 2 days 66.97 -0.69 -1.02% Domestic Swt. @ Cushing 1 day 61.25 -0.25 -0.41% Giddings 1 day 55.00 -0.25 -0.45% ANS West Coast 3 days 68.39 -0.31 -0.45% West Texas Sour 1 day 58.55 -0.20 -0.34% Eagle Ford 1 day 62.50 -0.20 -0.32% Eagle Ford 1 day 62.50 -0.20 -0.32% Oklahoma Sweet 1 day 61.25 -0.25 -0.41% Kansas Common 2 days 55.00 -0.75 -1.35% Buena Vista 2 days 71.19 -0.59 -0.82% Click Here for 150+ Global Oil Prices

Click Here for 150+ Global Oil Prices

Click Here for 150+ Global Oil Prices

1D 1M 3M 1Y All Charts Discussion Headlines 14 hours EIA: OPEC+ Cuts To Lift Oil Prices Through April 16 hours Iraq Denies UAE Firm’s Claim U.S-Seized Iranian Oil Cargo Was From Baghdad 18 hours Nigeria Bribery Case Ends In Victory For Shell, Eni 19 hours EV Metal Index Doubles As Lithium And Cobalt Prices Explode 21 hours Qatar To Build A Luxury Floating Hotel That Generates Electricity 22 hours Enbridge: Line 5 Shutdown Will Lead To Immediate Oil Shortages 23 hours China Breaks $1B Fuel Smuggling Ring 2 days API Surprises Analysts With Unexpected Crude Draw 2 days U.S Import Prices Jump As Oil And Other Commodities Rally 2 days Four New Natural Gas Pipelines Come Online In The U.S. 2 days Lithium Prices Have Soared 88% This Year 2 days The World Needs $131 Trillion In Clean Energy Investment By 2050 2 days UK Faces Decline In Oil Production 2 days Tesla Crash Prompts More Safety Investigations 3 days U.S. Braces For Expensive Gasoline This Summer 3 days U.S. Overtakes Saudi Arabia As India’s No.2 Crude Oil Supplier 3 days U.S. LNG Exports To Asia Surged By 67% In 2020 3 days UAE Claims Ownership Of Oil Cargo U.S. Just Seized 3 days NTSB: Tesla Uses Customers As Guinea Pigs For Autopilot Tech 4 days Record High Fuel Prices Hurt India’s Oil Demand 5 days Colombia Will Back Its Coal Industry For Decades To Come 5 days Tesla Looks To Develop EV Charging Infrastructure In India 6 days Oil Exploration To Hit Record High In Guyana 6 days China’s Steel Industry Has Been Hit Hard By Its ‘War On Pollution’ 6 days Saudi-Led Coalition Carries Out 32 Airstrikes Against Houthi Rebels 6 days Europe Can’t Keep Up With Demand For Battery Metals 6 days California County Sued Over A Potential 43,000 New Oil Wells 6 days Texas Strikes Back At The Anti-Fossil Fuel Lobby 6 days Colorado Braces For The Worst Winter Storm In 135 Years 6 days Israel Strikes Iranian Oil Tankers Bound For Syria 7 days Battery Giant LG Chem To Invest $4.5 Billion In U.S. Expansion 7 days U.S. Needs To Cut Emissions By 57% To Meet Paris Agreement Goals 7 days Mexico Energy Reform Sparks Wave Of Lawsuits 7 days Gold Erases Gains On Rebounding Treasury Yields 7 days Coal India Approves $6.4 Billion In New Coal Projects Despite Green Push 7 days Budget Airlines: European Clean Fuel Quotas Are Unfair 7 days Two Major Institutions Team Up To Boost Renewables In Latin America 8 days Saudi Oil Exports Holding Strong Despite Production Cut Commitment 8 days Saudis Vow To Protect Oil Facilities And Global Supply After Latest Attacks 8 days Qatar Exports First Oil To Arab Gulf Neighbor Since Rift Ended 3 minutes Texas forced to have rolling brown outs. Not from downed power line , but because the wind energy turbines are frozen. 7 minutes Scientists Warn That Filling The Sahara With Solar Panels Is A Bad Idea 11 minutes United States LNG Exports Reach Third Place 15 minutes Joe Biden's Presidency 1 day Hilarious: New Mexico seeking exemption from Biden oil and gas leasing pause - governor 10 hours Geothermal energy using oil/gas drilling techniques 2 days U.S. Presidential Elections Status - Electoral Votes 9 hours A Wind Farm in Coal Country 8 hours America Makes Plans to Produce Needed Rare Earth Minerals Domestically 4 days IS SAUDI ARABIA SENDING A MESSAGE TO BIDEN 6 days Tesla Is Plugging a Secret Mega-Battery Into the Texas Grid 20 hours ‘We Have More Leverage in the Free World Than We Think’ Against Chinese Regime 5 days Why is Bitcoin suddenly plunging? 5 days Good Marriage And Bad Divorce: Germany's Merkel Wants Britain and EU To Divorce On Good Terms

Breaking News:

EIA: OPEC+ Cuts To Lift Oil Prices Through April

Find us on:

Biden’s EV Agenda Has One Major Problem

The Biden administration’s drive to

Russia Refuses To Give Up On Senegal’s Oil Boom

Following a failed attempt to

Mexico’s Pemex Boasts Billion-Barrel Oil Discovery

Mexico’s Pemex has discovered a

Home Energy Energy-General

Robert Rapier

More Info


Facebook Twitter Linkedin Reddit

Premium Content

5 Oil And Gas Predictions For 2021

By Robert Rapier - Jan 27, 2021, 2:00 PM CST Join Our Community

When I made my 2020 predictions a year ago, the world was on the cusp of a pandemic that would upend the oil markets. In the process, it upended two of my energy sector predictions, but three others ended up being correct . The Covid-19 pandemic last year was a black swan event that caused an unprecedented fallout across the energy sector. The evolution of the pandemic this year will be the largest variable impacting the energy sector. Yes, larger even than any policies our new President will enact.

The energy sector is already off to a fast start in the equity markets this year, as the market is anticipating a return to normal. But if those expectations falter and it takes longer than expected to get the pandemic under control this year, there is a risk of a significant pullback.

Against that backdrop, below are my predictions for some of the significant energy trends I expect this year. As I usually point out, the discussion behind the predictions is more important than the predictions themselves. That’s why I provide extensive background and reasoning behind the predictions.

I also make predictions that are specific and measurable. At year’s end, there are specific metrics that will indicate whether a prediction was right or wrong.

1. The average price of WTI in 2021 will be between $50/bbl and $55/bbl.

Oil is still the world’s most important commodity, so I always try to lead off with a prediction on the direction of oil prices. I generally make this prediction by looking at supply and demand trends, as well as inventory levels.

A year ago, I thought my prediction was aggressive, but sound. I felt like oil prices would be strong all year. But this was one prediction the pandemic upended within a month of making it.

Because we don’t know how long it’s going to take to get the pandemic really under control, there’s a lot of uncertainty around the direction of oil prices. Oil prices rallied in the fourth quarter, and are now close to where they were a year ago. That anticipates a strong recovery. However, OPEC is sitting on spare production capacity that they can bring online if demand starts to rise. That will provide some headwinds for oil prices.

Related: Oil Majors Are Eyeing A Suriname Offshore Boom In 2020, the average daily price for West Texas Intermediate (WTI) was $39.16 per barrel (bbl). That was nearly $20/bbl lower than in 2019. This year, I think it’s almost certain that WTI will average higher than it did last year, but I think it’s doubtful that it averages as much as it did in 2019.

The spot price of WTI is presently $53.00/bbl. Demand is still trending lower than it was a year ago, and that presents some risk of prices falling further. OPEC will likely be a cap on the high side. Thus, I predict that the average annual price for WTI in 2021 will be between $50/bbl and $55/bbl.

However, I will add a couple of caveats. If one of the new variants of Covid-19 isn’t covered by the available vaccines or if it takes longer than expected to get the pandemic under control, oil prices will break back below $50. But if the pandemic is brought under control quickly, we could see a strong recovery in oil prices that could break above $55. Demand in the U.S. is weaker than it was a year ago, but that isn’t the case for all countries. OPEC is still ready to ramp up production, but it is possible that prices may get ahead of OPEC action.

2. Total U.S. oil production will decline for the second straight year.

According to the Energy Information Administration (EIA), U.S. oil production plummeted in the second half of 2020. At present, year-over-year production is 2.0 million BPD lower than it was a year ago. The number of rigs drilling for oil has risen in recent weeks, but it is still down 57% from a year ago.

President Biden has already suspended new oil and gas leasing and drilling permits on U.S. lands and waters for 60 days. He has also canceled the permit for the Keystone XL pipeline, signaling that this administration will not be friendly to the oil industry.

All of this points to the likelihood that U.S. oil production will continue the decline it began in late 2020. I expect the decline to slow, and perhaps stabilize, but it would take a strong reversal to see U.S. oil production grow in 2021.

3. The average natural gas price will be at least 25% higher than it was in 2020.

Last year I predicted that natural gas prices would average the lowest level in more than 20 years. That did in fact happen. The average Henry Hub natural gas spot price for 2020 was $2.03/MMBtu, which was the lowest annual average since the EIA began tracking that data in 1997.

Related: Barclays: WTI To Average $52 In 2021

But falling oil production means a decline in natural gas supplies that are associated with that oil production. That tightens up supplies, which was a factor in the subsequent recovery of natural gas prices in late 2020.

I predict that recovery will continue into 2021. I expect natural gas prices to average above $2.50/MMBtu in 2021, which would represent a ~25% or more increase above 2020.

4. U.S. oil imports will increase in 2021.

U.S. oil imports have steadily declined since 2005 when they averaged 10.1 million BPD. There was a brief reversal in 2016 and 2017 a consequence of lower prices that negatively impacted U.S. oil production. But by the end of 2020, crude oil imports had fallen to 6.0 million BPD.

I expect this trend to reverse in 2021. A combination of last year’s price collapse and new regulations from the Biden Administration will likely drive U.S. oil production lower this year, but overall oil demand is going to recover. That means more imports will be called upon to fill the void.

5. ConocoPhillips will have a total return of at least 30%.

I generally like to close with a prediction on ConocoPhillips, which is the world’s largest publicly traded, pure oil and gas producer. Last year I predicted it would return 20% on the year. The company was positioned to have a good year before the pandemic caused oil demand to collapse. So instead, ConocoPhillips closed the year down nearly 40%.

As I write this, the year-over-year WTI price is 8.7% lower. But shares of ConocoPhillips are still 32% lower than they were a year ago. The company is positioned to cover dividends and capital expenditures with WTI at $40/bbl. At $50/bbl, the company should do quite well.

Barring another collapse in oil prices this year, I expect the market to eventually acknowledge the value proposition. As I said a year ago, even if oil prices collapse I expect ConocoPhillips to weather the storm. They have been around for a long time, and are one of the best-managed oil companies on the planet. The company also has significant exposure to natural gas, so higher prices there will be more icing on the cake.

There you have my 2021 energy sector predictions. As always, I will grade them at the end of the year.

By Robert Rapier via

More Top Reads From

Was Saudi Arabia's Surprise Production Cut A Good Idea?
Goldman Bullish On Oil As It Eyes Major Relief Package
Can Shale Resist The Lure Of Another Output Surge?
Download The Free Oilprice App Today

Back to homepage


Previous Post

The Global Car Industry Is Finally Set To Rebound

Next Post

The World’s Biggest Oil Firms Face Rating Downgrades

Robert Rapier

More Info

Related posts

Big Oil’s Hottest Prospects In 2021

U.S. Consumers Will Pay The Bill For Higher Crude Prices

Three Commodities Set To Boom As The Global Economy Recovers

Leave a comment

Most Popular

Biden’s Energy Agenda To Reduce Oil Production And Boost Prices

Mexico’s Pemex Boasts Billion-Barrel Oil Discovery

How Biden’s Tax Hike Affects Oil

China Ramps Up Oil Imports From Iran

Oil Prices Slip As U.S. Rig Count Falls

Trending Discussions

More About Us About Us Site News Sitemap Advertise with us Site info Terms & Conditions Disclaimer Privacy Policy Contact Us


The materials provided on this Web site are for informational and educational purposes only and are not intended to provide tax, legal, or investment advice.

Nothing contained on the Web site shall be considered a recommendation, solicitation, or offer to buy or sell a security to any person in any jurisdiction.

Trading and investing carries a high risk of losing money rapidly due to leverage. Individuals should consider whether they can afford the risks associated to trading.

74-89% of retail investor accounts lose money. Any trading and execution of orders mentioned on this website is carried out by and through OPCMarkets.

Merchant of Record: A Media Solutions trading as

  • Opinion: Oil and gas industry are good for Ohio ...
    Oil and Gas Oil production began in earnest in California in the late 1800s. The Legislature created what is now the Geologic Energy Management Division (CalGEM) in 1915 to ensure the safe development and recovery of energy resources. Going forward, CalGEM is committed to protecting public health, safety, and the environment as we regulate the ...
  • Biden To Freeze New Oil And Gas Leasing On Federal Land
    However, oil and gas groups have warned that this move, along with Biden’s decision to require approval by a top-ranking administration official for any leases or permits granted within the ...
  • Oil Natural Gas & Mineral Extraction Taxes : All NM Taxes
    A vastly improved search engine helps you find the latest on companies, business leaders, and news more easily.
  • Top Oil and Gas Penny Stocks for Q1 2021 - Investopedia
    Oil and Gas. Exxon Mobil reports a $20 billion loss, fourth-straight quarter in the red. Tue, Feb 2nd 2021. Energy. Energy experts on the increasing risks ahead for Big Oil.
  • Oil & Gas 360 - Oil and Gas News, Analysis and Insights ...
    Gas-fired equipment costs less than oil-fired gear. For a basic furnace (for a forced air heating system) or boiler (for hot-water heat), you'll pay around $1,500 to $3,000 for gas and $2,000 to as much as $8,000 for oil, says Ellis Guiles of TAG Mechanical in Syracuse, New York.
  • Home | Oil & Gas Journal
    Armour Energy proposes demerger of its northern basin oil and gas assets. Armour Energy Ltd., Brisbane, has proposed a demerger and separate Australian Stock Exchange listing for the company’s ...
  • Board of Oil and Gas Conservation — Montana DNRC
    How Oil & Gas JobSearch can help. Personal Job Recommendations. Using our state of the art job matching process, we can recommend you jobs based on your previous searches, applications and CV and employment history making your search for the perfect role even easier. Quick Apply.
  • Jersey Oil and Gas shares slide as firm suggests equity ...
    Annapolis sues 26 oil and gas firms alleging they 'concealed' knowledge of climate change. By John Bowden - 02/23/21 06:00 PM EST . City officials in Annapolis, Md., filed a lawsuit Monday ...
  • 5 Oil And Gas Predictions For 2021 |
    QEP Resources Inc.: QEP Resources is an independent crude oil and natural gas exploration and production company.The company posted a net loss of $49.2 million as revenue sank 42.2% in Q3 2020 ...
  • 2021 Oil and Gas Industry Outlook | Deloitte US
    But falling oil production means a decline in natural gas supplies that are associated with that oil production. That tightens up supplies, which was a factor in the subsequent recovery of natural ...