FocusEconomics forecasts lower energy prices through 2027

FocusEconomics expects crude oil, natural gas and coal prices to decline over the next several years, although the firm said the timing of savings for consumers will vary by country. In an analysis dated Tuesday 20 October, FocusEconomics said prices could remain above levels recorded before the Middle East conflict.

For Sint Maarten, which relies on imported fuel and goods, international energy costs can affect electricity bills, petrol prices and the cost of imported products. FocusEconomics said lower crude prices do not automatically translate into lower retail costs because refining, transport, distribution, taxes and fuel-purchasing timing also affect prices.

The firm forecast that crude oil prices would gradually decrease through the end of 2027 as production recovers and shipping routes become more reliable. It said prices could continue to decline in 2028 before becoming more stable toward the end of the decade.

FocusEconomics said conflict involving Iran, disruptions to Middle East oil and gas supplies, attacks on Saudi Arabian energy infrastructure, weather and changes in global demand have added uncertainty to energy markets. It said forecasters differed considerably on how far energy prices may fall, particularly for natural gas.

NV GEBE increased its electricity fuel clause from 36 cents per kilowatt-hour in April to 45 cents in May, citing higher international fuel costs. A further increase to 49 cents per kilowatt-hour followed in July. FocusEconomics said any sustained fall in international oil prices could eventually reduce electricity-production costs, depending on fuel purchasing costs and the utility’s tariff calculations.