Capital Economics strategists expect the price of Brent reaches a peak in the third quarter around $ 80 per barrel, before falling back in the fourth quarter and throughout 2022 when supply recovers..
Key Comments:
“Oil supply will remain limited for some time. The renewal of current OPEC + production cuts and the fact that demand is still subdued means that compliance with quotas, particularly in OPEC countries, is likely to remain high for at least the next few months. .
“There will be a release of ‘pent up’ demand as quarantine measures are lifted, starting in the second quarter. And even if international travel restrictions remain in place, we would still expect demand to increase as many people would travel domestic rather than international. “
“The broad political support provided by governments and central banks it will provide an additional boost in favor of risk assets, such as oil. “
“We expect the world oil market to run a slightly larger deficit in the first half of the year than we expected, which will give prices a new boost. Nevertheless, we still believe that the price of Brent will fall to $ 70 per barrel by the end of 2021 and $ 60 by the end of 2022, as the momentum of pent-up demand fades and supply recovers. “
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