BAKU, Azerbaijan, Jan.12
By Leman Zeynalova – Trend:
In a reversal of 2020, energy commodities will be the only commodity sub-index to rise in 2021, Trend reports citing UK-based Capital Economics research and consulting company.
“We expect the price of Brent (WTI) to rise to $60 ($58) per barrel by end-2021 as the global oil market remains in a persistent deficit. A vaccine-induced rebound in global travel activity should lead to a revival in demand. At the same time, the continuation of OPEC+ production cuts along with low levels of investment last year, particularly in the US, should mean that global supply remains constrained,” the company said in its latest report.
The biggest downside risk to the oil price forecasts is if the recovery in oil demand is far weaker than is currently expected, perhaps because of a slow rollout of vaccines, according to the company.
“However, even if vaccine rollouts are slow, we suspect that OPEC+ will partially extend their production quotas once again to limit oversupply.
In a similar vein, we are fairly upbeat on the outlook for natural gas prices this year in part because industrial demand should recover in tandem with the revival in global manufacturing activity. That said, we expect coal prices to remain relatively low in 2021 as the ongoing decarbonisation in power generation will continue to act as a drag on demand growth,” said Capital Economics.
The US JP Morgan Bank expects Brent prices to stand at $43/bbl in Q1, 2021, $49/bbl in Q2, $51/bbl in Q3 and $56/bbl in Q4.
Brent prices will peak at $67/bbl in Q2 of 2022, while in Q1, Q3 and Q4 this figure will be equal to $61/bbl, $64/bbl and $55/bbl, respectively.
In 2021, WTI prices will rise to $47/bbl, while the quarterly prices will be equal to $41/bbl, $47/bbl, $48/bbl and $53/bbl.
WTI prices will keep on rising to $58/bbl in 2022, according to JP Morgan. The forecasts for the four quarters are as follows: $57/bbl, $63/bbl, $60/bbl and $51/bbl.
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