BAKU, Azerbaijan, July 21. Brent price forecast is revised up to $109 per barrel from the previously projected $107 per barrel for 2022, and to $98 per barrel from $93 per barrel, Trend reports via Asian Development Outlook (ADO) 2022.
“The protracted war in Ukraine, supply constraints, and recovering domestic and international travel as economies, recovering from COVID-19, continue to reopen will put upward pressure on oil prices, but this will be tempered by recession fears due to rising inflation,” the report said.
As ADB foresees, oil prices are expected to fall from the third quarter of the current year, “on rising supply and the market gradually returning to balance”.
“Pointing to softening prices is the 20 percent increase in the number of rigs in the US since the end of 2021 and the Organization of the Petroleum Exporting Countries Plus members, on 2 June, agreeing to increase production quotas by nearly 50 percent in July and August. Crude oil prices will remain volatile,” the report noted.
However, in fact, prices can change quickly in any sense, as the market is currently tense due to low global stocks, ADO added.
Meanwhile, Asian Development Bank (ADB) does not rule out the possibility of oil prices peaking at $200 per barrel in the coming months.
“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.
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