Crude oil price: Oil rally has more room for maneuver, Brent expected to hit $ 80 a barrel

0
U.S. investment bank Goldman Sachs expects Brent crude prices to hit $ 80 a barrel this summer, betting that a recent rally in the oil market will continue as vaccination deployments boost global economic activity and the demand for the raw material.

Brent prices hit $ 72.93 a barrel this week, their highest level in more than two years, fueled by expectations of stronger demand.

Brent futures were trading at $ 72.21 a barrel on Friday, while U.S. West Texas Intermediate (WTI) crude was around $ 70 a barrel.

“Rising vaccination rates are driving greater mobility in the US and Europe, with estimated global demand rising 1.5 mb / d (million barrels per day) over the past month to 96,” 5 mb / d, “the bank said in a late-released note. Thursday.

Goldman, which has long-standing expertise in the commodities sector, expects the recovery in demand for oil to continue and sees global demand reaching 99mb / d in August.

The investment bank also said slow negotiations on an Iran nuclear deal could also weigh on oil supplies, supporting prices.

Iran and the world powers have been negotiating since April to lift sanctions against Tehran, which has hit its economy hard by reducing its vital oil exports.

US Secretary of State Antony Blinken said on Tuesday he expected that even if Iran and the United States returned to respecting the nuclear deal, hundreds of US sanctions against Tehran would remain in place.

“Recent headlines give us confidence in our expectation that a potential recovery in Iranian exports will not occur until the fall,” the bank said.

“While there is both excess capacity upstream of OPEC + and downstream of refineries, we expect OPEC + to lag behind the rebound in demand.”

Share.

About Author

Comments are closed.