BAKU, Azerbaijan, Aug.16. Reiterating its long-standing baseline for Brent to average $101 in 2H 2022 and $98 per barrel in 2023, JP Morgan Bank now sees risk bias as neutral to down, Trend reports with reference to the Bank.
JP Morgan’s reiterated view has four drivers: 1) the oil market moves into a surplus in 2H 2022, followed by another surplus in 2023, with OECD commercial oil inventories still 292 mn bbl below five-year averages; 2) global economy avoids recession and oil demand growth remains resilient; 3) the EU embargo on Russian oil comes into a full effect in February 2023, but the measures are softened; 40 no oil price cap.
“The risk to our baseline view has shifted from upside to neutral for 2H2022 and marginally down for 2023. The upside asymmetry in the oil price we previously envisioned, has diminished as the 30 percent drop in the oil prices and the easing of EU sanctions on Russia are reducing the risks of a price cap and the resulting material loss in supply. Although the EU embargo on Russian crude and product imports will come into full effect in February 2023, some European governments have amended parts of their sanctions, effectively permitting the lifting of Russian crude by European companies,” said the Bank.
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