The World Bank has raised its forecast for global oil prices for 2016.
That’s an increase from $37 (£25.3) per barrel to $41 (£28) per barrel and comes amid “improving market sentiment and a weakening dollar”.
The crude oil market rebounded from a low of $25 (£17) per barrel in mid-January to $40 (£27) per barrel in April following production disruptions in Iraq and Nigeria and a decline in non-OPEC production, mainly US shale.
A proposed production freeze by major producers failed to materialise at a meeting in mid-April.
However the World Bank still expects all energy prices – including oil, natural gas and coal – to remain heavily depressed compared to last year but has revised down its January prediction of a 24.7% slide to a 19.3% fall compared to 2015.
John Baffes, Senior Economist and Lead Author of the Commodities Markets Outlook said: “We expect slightly higher prices for energy commodities over the course of the year as markets re-balance after a period of oversupply.
“Still, energy prices could fall further if OPEC increases production significantly and non-OPEC production does not fall as fast as expected.”