Analysts expect Brent crude oil to cost an average of $70.89 per barrel in 2021. This is the highest forecast for this year since April 2019.
Oil prices will approach $80 by the end of the year. Tight supply and higher gas prices are driving the switch to crude oil for power generation.
Prices are expected to be $80.92 per barrel in the fourth quarter of this year and $78.74 next quarter.
The main factors affecting oil prices will continue to be the European energy crisis and the shift from natural gas to oil derivatives.
We expect this problem to be resolved around mid-2022, as the United States plans to pump more oil as a countermeasure.
U.S. crude oil is forecast to reach $68.62 per barrel. This is the highest forecast for 2021 since March 2017. WTI averaged $78.06 in the current quarter and $75.68 in the first quarter of 2022.
Analysts expect global fuel demand to increase by 5-6 million per day this year.
Both grades of crude oil are trading near their highest levels in years. The decisive factor was a steady supply shortage in the world. Most demands returned to normal levels before the epidemic. As a result, prices for coal and natural gas have soared.
Despite supply shortages from OPEC and OPEC+ including Russia, production increased by 400,000 barrels per day.
OPEC+ expressed satisfaction with oil prices around $80. But how will the group monitor the market and increase supply if necessary?
In addition, the occurrence of several variables such as COVID-19, the Iran nuclear deal, and the central bank’s response to rising inflation due to rising energy prices will be an important factor in oil price volatility.