Energy, crude oil prices outlook for 2025, according to Raymond James

Investing.com -- Raymond James analysts provided a cautious outlook for the vigor assemblage successful 2025. 

Despite energy's underperformance implicit the past 2 years, the midstream radical emerged arsenic a agleam spot successful 2024, with the Alerian/AMNA scale surging 37% and Raymond (NS:) James' midstream sum radical up 41%.

Geopolitical tensions, specified arsenic the ongoing struggle successful Ukraine and caller Middle East confrontations, person had small interaction connected lipid marketplace fundamentals. 

"Oil terms volatility continues to beryllium driven by alternatively old-fashioned proviso and request factors," the analysts note. 

They item mixed messages from OPEC and anemic request from China arsenic cardinal contributors to the existent marketplace uncertainty. Additionally, the spot of the U.S. dollar, peculiarly astir the U.S. election, is besides exerting downward unit connected lipid prices.

Looking ahead, Raymond James forecasts West Texas Intermediate (WTI) crude to mean $70 per tube successful 2025, somewhat supra the futures strip, with carrying a $5 premium. 

In contrast, U.S. prices are expected to mean $4 per Mcf, importantly higher than existent futures prices.

A notable taxable for 2025 is the continued interaction of artificial quality (AI) connected the vigor sector. 

"AI remains the number-one communicative successful the vigor sector," Raymond James states. “Accommodating this incremental request volition instrumentality an all-of-the-above strategy: gas, renewables, and - successful definite circumstances, and with precise agelong pb times - atomic arsenic well.”

“The vigor assemblage presently sits astatine lone ~3% of S&P marketplace cap, but capitalist sentiment inactive remains supra pre-COVID levels. That being said, near-term uncertainty regarding the commodities (namely oil) has near investors with small condemnation astatine the moment,” concluded the firm.