Energy Intelligence External Break-Even Price Outlook

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Supply constraints, inflated import costs and falling natural gas prices to weigh on break-evens

Energy Intelligence’s updated external break-even price modeling – part of our proprietary long-term supply/demand forecasts – indicates that the 2023 average price needed by Opec-plus producers rose to about $77/bbl, driven by lower volumes and inflated import costs. 

Saudi Arabia, the UAE and Russia, the group’s most influential producers, are all expected to see their external break-even prices rise in 2023, although they are likely to remain comfortably below the $70/bbl point this year. Notably, constraints on Russia’s exports that have pushed it to offer steep discounts are now likely to see it sustain elevated break-even prices indefinitely. 

Longer term, we now see producers running even higher break-evens out to the mid-decade point. Critically, many of the group’s most vulnerable producers are likely to see break-evens rise well above $80/bbl in the coming years. 

If this path continues, it will likely help solidify support for Opec-plus’ current market strategy supporting oil prices above $80/bbl. 

Energy Intelligence’s External Break-Even Price Outlook is a proprietary analysis of the average external break-even price – which measures the oil price needed to pay for imports and balance external accounts – needed by the Opec-plus group.

You can learn more about the External Break-Even Price Outlook – and our Risk Service – in the full report download.

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The External Break-Even Price Outlook is part of the Risk Service which helps the oil and gas industry mitigate risks and capture opportunities at the nexus of energy, politics and energy transition. We deliver a combination of news, analysis, data and research to help clients secure new investment opportunities and mitigate traditional and emerging aboveground risks.

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