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Capital Economics’ Jessop on goldilocks ‘not too high, not too low’ oil price

Julian Jessop, Chief Global Economist from Capital Economics says the recent uptick in the price of oil could be beneficial for energy industry players. The ideal scenario he says would be if prices settle between US$45 to US$60 in the next few years which is “high enough to ease some of the pressure on producers.  It means the big oil companies will continue to invest and they won’t go bankrupt.”

The price of oil hit the psychologically important US$50 a barrel for the first time this year and according to Jessop the team at Capital Economics see prices recovering to US$60 and 'maybe' back towards US$70 over the rest of the decade.  “Over the remainder of this year,“ Jessop says, “I think the risks might actually be on the downside.”

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