BAKU, Azerbaijan, July 21. Asian Development Bank (ADB) does not rule out the possibility of oil prices peaking at $200 per barrel in the coming months, Trend reports via Asian Development Outlook (ADO) 2022.
“The possibility of a supply shock that leads to an oil price spike as high as $200 per barrel cannot be ruled out. An escalation of the war in Ukraine could be followed by an immediate EU ban on Russian oil. If that happens, it is unlikely that other oil exporting countries will be able to fill the resulting shortfall of 3.5-7 million barrels a day in the short run,” the report said.
OPEC has been falling short of production targets, the US shale oil producers are reluctant to ramp up production despite the price exceeding $100, partly due to supply chain disruptions, debt problems, and rising costs while redirecting Russian oil to third countries involves complex logistics, ADO explained.
According to the outlook, “under these circumstances, a price of $200 per barrel could be possible given that oil markets can overshoot and the previous peak of $140 in June 2008, which equates to over $180 in today’s dollars, was driven by a series of supply disruptions and did not involve geopolitical issues and sanctions against a major oil producer”.
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