In a note from commodity analysts at CommerzBank, some snippets pertinent to their oil price outlook:
- The price slide is chiefly attributable to concerns that oil demand could weaken as a result of the latest market turmoil, even though there has been no sign of this happening as yet
- Though the latest price slide is due for the most part to higher risk aversion following the market turmoil, it is not probable that this will be quickly and completely reversed
- After all, fundamentals such as market balance and stock levels no longer look as price-positive as the International Energy Agency had previously predicted
As such the bank's Brent crude oil forecast has been lowered to $80/bbl for the middle of this year, from its prior projection of $95.
Further:
- expects the oil price to rise after this because OPEC+ (the Organization of the Petroleum Exporting Countries and its allies, chiefly Russia) is unlikely to stand idly by while the oil price continues to plunge, and will no doubt reduce supply if necessary
- sees Brent back at $90 by year-end 2023
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I posted this chart earlier if you think you are seeing double (i.e. you're right!)
