BAKU, Azerbaijan, Sept.29
By Leman Zeynalova – Trend:
Traders could push oil price as high as $100, most definitely, Sam Barden, Director of SBI Markets, an international commodity trading and advisory company, told Trend.
Oil prices have exceeded $80 per barrel for the first time since 2018, amid the gas supply crunch in Europe. Goldman Sachs has revised up its forecast for Brent prices from $80/bbl to $90/bbl as of 2021 based on the expectations for faster demand recovery and tight global supplies due to Hurricane Ida.
“It could also be used as a hedge against volatile currency movements. The panic buying in the UK will also keep prices strong, as it appears this is a supply chain issue, which is not easily fixed, so expect a lag between demand and supply,” said the expert.
Barden believes that OPEC will likely pump more oil, “but again you have to look at supply chain bottle necks rather than overall supply”.
“There is no shortage of oil in the world, but there is a lack of ability to deliver it through the supply chain to end consumers. Supply chain disruptions have no doubt pushed oil prices higher, as the delivery of cargoes has been slowed. Higher gas prices are likely pushing oil prices up. Lastly inventories may be generally lower than anticipated across the world and is adding to the upward pressure on oil prices. Traders in the market will be using these factors to also push prices higher with long positions in the futures markets. More likely we will see increased volatility in oil prices. Oil prices will stay strong through to the end of this year,” he concluded.
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