“We have raised our base-case average price assumptions to USD57.5/bbl (Brent) and USD55/bbl (WTI) for this year and next, an increase of USD5/bbl for 2018 and USD2.5/bbl for 2019. These are also our forecasts for 2020 and beyond. The stronger near-term price outlook reflects the success of OPEC-plus in reducing excess stock, and our expectation that compliance with the agreement will remain fairly strong in 2018,” according to Fitch.

The expanding global economy has increased demand for commodities and drawn down oil inventories. For instance, according to the Energy Information Administration, U.S. crude stockpiles have declined for the past 10 consecutive weeks and are now at their lowest level since 2015.

The energy industry has grown more efficient after cutting costs in response to the plunge in crude oil prices in previous years, so they are now in a better position to improve revenue at lower oil prices.

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