...

Brent expected to bounce back in $100s soon

Oil&Gas Materials 22 September 2022 10:57 (UTC +04:00)
Brent expected to bounce back in $100s soon
Laman Zeynalova
Laman Zeynalova
Read more

BAKU, Azerbaijan, September 22. For Q4 2022, Brent is expected to bounce back in the $100s supported by supply pressures, demand offsets and thin buffers, and peak in the mid-$110/b in Q1 2023 before retreating again around $100/b for the remainder of the year, Trend reports with reference to the Oxford Institute of Energy Studies (OIES).

“Our Reference forecast for Brent is downgraded by $5.9/b to $105.1/b in 2022 and by $0.6/b to $105.8/b in 2023. Absent large disruptions in Russian supplies and/or considering a recession in advanced economies, Brent could fall in the mid-$80s within Q4, while the price band in 2023 ranges between $77/b and $130/b.

The balance of risks this month is further skewed on the downside with supply risks reflecting the extent of Russian disruptions returning in the very near-
term, but negative demand risks escalating towards year-end and dominating in 2023. The Brent Prospect that takes into account the uncertainty underlying the outlook edges lower than our reference forecast in both years to $102.6/b in 2022 and $95.8/b in 2023,” the report says.

OIES forecasts a 0.3 mb/d surplus in 2022 and a -0.1 mb/d deficit in 2023.

“The oil market is expected to shift into a 1 mb/d surplus in H2 2022 and remain near balance in 2023 as deficits could return in H2. This could help support the stocks replenishment towards year-end, but it is expected to slow down again as we move into 2023. The uncertainty engulfing the oil market in 2023 remains elevated reflecting both endogenous supply/demand outcomes that are subject to shocks within the oil market, but also external factors such as policy actions/responses that could impact and change this outcome by generating shocks outside the oil market. This uncertainty is reflected on the global balance risks that show the supply/demand gap in 2023 ranging between -1.9 mb/d and 2.8 mb/d.”

---

Follow the author on Twitter: @Lyaman_Zeyn

Tags:
Latest

Latest