Come 2025, SAMOG and MOGI Companies will be bracing for challenges of growth

SAMOG: Standalone mineral oil and gas

MOGI: Mineral Oil Gas Integrated

Crude oil prices. USEIA has reduced the forecast for the Brent crude oil spot price through the end of 2025. It expects the Brent price will average $78 per barrel (b) in 2025, $7/b less than the price in 2024. In the forecast, lower crude oil prices largely reflect a reduction for global oil demand growth in 2025. However, crude oil prices have risen in recent days because of escalating conflict in the Middle East, raising the possibility of oil supply disruptions and further crude oil price increases.

Petroleum product price. Lower crude oil prices reduce the forecast prices for most petroleum products. The largest change from the last forecast is for propane. USEIA forecast the Mont Belvieu propane spot price will average 72 cents per gallon (gal) in 2025, down 15% from the forecast of 84 cents/gal last month. For other products, the expectation is the retail diesel price will average about $3.50/gal next year, down by 5% from last month’s forecast. We expect the U.S. average retail gasoline price will average $3.20/gal next year, down 2% from last month.

Natural gas prices. The Henry Hub natural gas spot price rose by 15% to $2.28 per million British thermal units (MMBtu) in September. The Henry Hub price is to continue rising to around $2.80/MMBtu in the fourth quarter of 2024 and to further increase to around $3.10/MMBtu on average in 2025 as liquefied natural gas exports, a component of total natural gas demand, increase with the addition of capacity.

Iron ore

The long-term forecast for 2025 on iron ore prices shall predict stable outcomes ranging between US$100-120 per metric ton. However, there are possibilities of short-run fluctuations due to instability from global economics but the general trend indicates stability resulting from supply-demand balancing. Analysts at Bank of America (BofA) Securities project that iron ore prices will fall below US$80 per tonne, driven by a supply surplus and declining demand from China's steel sector.

Coal

International coal prices are expected to decline by 28 percent in 2024 and a further 12 percent in 2025. Upside risks to the coal price outlook include higher-than-expected growth in China’s consumption and various factors that could lower renewable electricity production, such as low rainfall or light wind conditions.

Global coal demand is set to remain broadly unchanged in both 2024 and 2025 as surging electricity demand in some major economies offsets the impacts of a gradual recovery in hydropower and the rapid expansion of solar and wind, according to the IEA’s latest update on coal market trends worldwide.It is quite likely that U.S. solar generating capacity will approach the amount of U.S. coal-fired capacity by the end of 2025, coal power plants tend to run at higher utilization rates over time. IEA expects that coal will account for about 16% of total U.S. generation in 2024 and 2025, down from 17% last year.

( This is an abstract of an article, the expanded version of which will appear in the Journal of Mines Metals and Fuels, https://informaticsjournals.com/index.php/jmmf)

The Journal of Mines Metals and Fuels is a 7-decade-old journal for minerals, metals, materials and energy industries. It is the longest-thriving journal in its category. (Submit articles in https://www.informaticsjournals.com/index.php/jmmf/about/submissions)