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Experts expect oil prices to stay at the $ 55- $ 60 per barrel level for at least two years.
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Analysts believe that what pushes oil prices to rise is not what is expected from vaccines, but rather OPEC + measures that put the market in a stable deficit.
The rapid rise in the price of Brent, close to the limit of $ 60 per barrel in early 2021, exceeded any expectations that had assumed that such signs were only possible at the end of the year. .
“It will all depend on the OPEC + decision in March,” said Karen Costanian, analyst at Bank of America Merrill Lynch, according to the TASS news agency, “But even if they agree to increase supplies by 1 , 5 million barrels per day from April, the market will still suffer from shortages. “Supply”, adding that in the next three to four months, “no one will have additional capacity except OPEC countries + to increase oil production “.
The supply deficit persisting throughout the year is the basis of the forecasts for OPEC + countries. According to the OPEC + ministerial meeting on February 3, member states expect demand to exceed supply, even in the face of increased oil production in April and June. The forecast deficit range goes from 0.3 million barrels per day to an average of 1.1 million barrels per day for this year.
Vasily Tanurkov, director of the “Accra” business classification group, shares the view that the oil market is currently being driven by the deficit caused by the actions of OPEC + producers and the fever of speculators. However, he sees this not only as a threat to the rapid resumption of shale oil production in the United States but also to OPEC + itself.
Tanurkov said in this regard: “The current prices seem completely artificial, because at any time one can expect a revision of the OPEC + agreement and an increase in quotas and this must be cooled.”
Costanian estimates that U.S. shale oil companies will need at least 7-9 months to achieve a sustainable resumption of production, despite the resumption of drilling operations in the United States, indicating that it is not necessary in the near future to expect a dangerous increase in production from oil shale.
Viktor Kurilov, analyst at the Norwegian consultancy firm “Rystad Energy”, points out another correction factor, which is the overestimation of the dynamics of the recovery in oil demand in 2021, and according to OPEC’s expectations, the Demand growth this year could reach 5.6 million barrels per day compared to a drop of 9 million barrels per day in 2020.
The expert suggested that any correction to current market conditions would be short-lived, adding: “In the baseline scenario, based on the main factors, we expect the price of Brent to remain in the 55 to $ 60, at least until the end of 2022. “
Moreover, the Costanian expert does not rule out that prices will climb to $ 70 per barrel this year, adding at the same time, saying: “But we think that the average of $ 60 per barrel this year is not a ambiguity. But the Bank of America has not revised its annual forecast. For oil prices, they have remained on average at $ 50 a barrel.
Source: TASS
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