Eni CEO: The oil price is heading higher

We are in a growing scenario: Eni CEO

While the oil market has experienced a few turbulent years, the chief executive of Italian oil and gas giant Eni believes the price of oil will eventually tick higher, but that it would still have to go through a transition period during 2017.

"I think that the price is going up," Claudio Descalzi, CEO of Eni, told CNBC on Wednesday.

Over the course of the last three years, the Italian firm has been undergoing its own restructuring to weather the volatility seen in the oil sector.

In Eni's "2017–2020 Strategic Plan" which was released Wednesday, the group said it expected to see a gentle rise in oil prices in the coming years, giving a forecast of up to $70 per barrel by 2020.

Nevertheless, the oil and gas major said in the report that it would "remain disciplined" by keeping its costs in check.

"I think that we are still in a transition period because the inventories are still very [rich] and we are still sell (to) the market, they have to generally reduce the inventories, the stocks and that is going to create some big ground noise."

"But clearly we are going to an imbalance between demand and supply," said Descalzi, adding that he believed the price was going to increase – admitting he was unsure when it would happen exactly – but that 2017 was "still a transition era."

We will focus more on upstream: Eni CEO

Over the past few years, investors have grown concerned over the global glut seen in the oil market, with prices having declined at times over fears that this glut could persist.

Both Brent and U.S. crude have, however, ticked higher in recent months, after OPEC and non-OPEC countries agreed to cut their production levels from the start of 2017, with the aim of bringing the market back to balance.

While OPEC compliance levels are high, market watchers are still keeping an eye on U.S. crude inventories and its recent rise.

Last week, prices came under pressure after data from the U.S. Energy Information Administration revealed that U.S. crude stocks had risen for the seventh consecutive week; Reuters reported. However it seems on Wednesday, positivity around OPEC has helped prices stay in the black.

Descalzi's comments come as the Italian oil and gas giant posted its latest earnings report for 2016's full year and fourth quarter.

In 2016's fourth quarter, Eni posted a better-than-expected adjusted net profit of 459 million euros ($483 million), up from an adjusted Q4 net loss of 301 million seen a year before.

The latest set of results revealed Eni's first quarterly profit in 18 months according to Reuters, helping the stock rise against most of its STOXX 600 peers during Wednesday's trade. At 2.45 p.m. London time, Eni shares were up over 3 percent.

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