As we close out 2024, the oil and gas market trends have highlighted significant shifts shaping the year. From changing oil prices to new production records and global events, it has been an eventful year for investors to learn from and build on.
Oil Prices Throughout 2024
Oil prices this year had their ups and downs, giving investors a mix of opportunities and challenges. Early in the year, prices climbed steadily, driven by strong demand and concerns about global supply. By March, Brent crude oil reached just under $88 per barrel, and West Texas Intermediate (WTI) followed closely at around $83. This rise reflected optimism about the reopening of economies and recovery in global trade.
In the middle of the year, oil prices dipped slightly. With an increase in U.S. crude stockpiles and a stronger dollar, prices softened during the summer. Brent crude hovered at $79, while WTI settled around $75. Despite this, the overall outlook for the second half remained strong as global demand persisted.
Toward the end of the year, oil prices regained strength. Support from OPEC+ production cuts and increased consumption during colder months pushed prices higher. Brent crude closed out the year in a stable range, providing investors with a sense of steadiness compared to earlier fluctuations.
Production Milestones
The United States continued to lead in oil production in 2024. Advances in technology and sustained investment in the Permian Basin allowed for steady output growth. By mid-year, U.S. production levels reached record highs, reinforcing the country’s position as a global energy leader.
OPEC+ countries played their part by carefully managing production levels to balance supply and demand. This collaboration helped maintain stability in global markets, which created opportunities for investors.
Canada also contributed significantly to North America’s energy output. With advancements in oil sands technology and increased pipeline capacity, Canadian producers met rising global demand efficiently.
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How Global Events Shaped the Market
This year, several global events had a hand in shaping the oil and gas market. Early in 2024, conflicts in the Middle East raised concerns about potential supply disruptions. While this initially led to higher prices, markets quickly adjusted, showcasing the industry’s ability to adapt. A ceasefire between Israel and Hezbollah, brokered by the U.S. and France, played a significant role in stabilizing the situation. This ceasefire alleviated fears of supply interruptions, contributing to a decrease in oil prices. The market’s rapid response highlighted the industry’s capacity to adapt to geopolitical tensions.
Closer to home, U.S. policies aimed at energy independence continued to support the oil and gas industry. Discussions about long-term energy security kept oil and gas in focus, highlighting its role in a balanced energy future. The administration prioritized increasing domestic energy production, including approving new liquefied natural gas (LNG) export permits and expediting oil drilling activities on federal lands and offshore areas. These measures aimed to enhance the nation’s energy self-sufficiency and support the oil and gas sector.
Additionally, discussions emphasized the importance of a balanced energy future, recognizing the ongoing role of oil and gas alongside renewable energy sources. The International Energy Agency highlighted U.S. leadership in promoting secure and clean energy transitions, noting significant investments in renewable energy capacity and low-carbon fuels.
These policies show a strong focus on keeping energy secure while moving toward cleaner options. For investors, staying informed about these changes is important because they influence the energy market and create new opportunities in oil and gas.
Investment Opportunities in Oil and Gas
For investors, 2024 has been a year of lessons and opportunities. Price fluctuations highlighted the need to stay informed and flexible. Those who closely followed market trends were able to capitalize on changes and maximize returns.
U.S. production growth remains a key focus for investors, as steady output minimizes the risk of sudden supply disruptions. Paired with OPEC+ efforts to manage global supply, the market felt more predictable, creating an environment of confidence for long-term investors.
The energy sector remains a reliable choice for those seeking steady returns. The oil and gas industry continues to evolve, with new technologies driving efficiency and demand remaining consistent worldwide. For investors, the focus should be on diversification and thorough research to identify opportunities that align with their goals.
This year’s oil and gas market trends show that oil and gas are still strong foundations for investment portfolios. By staying engaged and informed, investors can look forward to steady opportunities in the coming year. For more insights, visit our website to explore how DW Energy Group can support your investment journey.
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Sources:
“Oil Market Report – March 2024,” International Energy Agency, https://www.iea.org/reports/oil-market-report-march-2024
“Today in Energy,” U.S. Energy Information Administration, https://www.eia.gov/
“Monthly Oil Market Report,” Organization of the Petroleum Exporting Countries, https://www.opec.org/opec_web/en/publications/338.htm
“United States produces more crude oil than any country, ever,” U.S. Energy Information Administration, https://www.eia.gov/todayinenergy/detail.php?id=61545
“U.S. crude oil production established a new record in August 2024,” U.S. Energy Information Administration, https://www.eia.gov/todayinenergy/detail.php?id=63824
“OPEC+ shifts meeting to Dec. 5, could delay output hike, sources say,” Reuters, https://www.reuters.com/business/energy/opec-postpones-output-policy-meeting-dec-5-sources-say-2024-11-28/
“Oil Sands Sector,” Natural Resources Canada, https://oee.nrcan.gc.ca/industrial/opportunities/sectors/oilsands.cfm
“Energy Efficiency Trends in Canada,” Natural Resources Canada, https://oee.nrcan.gc.ca/publications/statistics/trends/2020/totalsectors.cfm
“Major Gulf markets gain on Hezbollah-Israel ceasefire,” Reuters, https://www.reuters.com/world/middle-east/major-gulf-markets-gain-hezbollah-israel-ceasefire-2024-11-28/
“Oil prices drop as talk of Israel-Hezbollah cease-fire cuts ‘security premium’ MarketWatch, https://www.marketwatch.com/story/oil-prices-consolidate-after-surging-on-rising-geopolitical-jitters-5a6cab61
“Exclusive: Trump prepares wide-ranging energy plan to boost gas exports, oil drilling, sources say,” Reuters, https://www.reuters.com/business/energy/trump-prepares-wide-ranging-energy-plan-boost-gas-exports-oil-drilling-sources-2024-11-25/
“IEA policy review highlights leadership of United States on energy security and clean energy transitions,” International Energy Agency, https://www.iea.org/news/iea-policy-review-highlights-leadership-of-united-states-on-energy-security-and-clean-energy-transitions