Outlook for Oil Prices

Crude oil markets have been all over the place during the past week
Oil prices are expected to overshoot $125 a barrel next year and $150 in 2023 due to capacity-led shortfalls in OPEC+ production, JP Morgan Global Equity Research reportedly said

Oil rose on Thursday, with benchmark Brent crude LCOc1 futures around $69 a barrel, as investors adjusted positions ahead of an OPEC+ decision on supply policy, although concern the Omicron coronavirus variant could hit fuel demand capped price gains. It has now emerged that though Omicron variant is more transmissible, it is so far not as deadly as earlier strains

J.P. Morgan Brent crude oil forecasts are currently at $83 per barrel (bbl) for Q4 this year, before falling to $78 for Q1 2022 and $80 and $75 respectively for WTI.

Commodity PricesUnitsPrice $change
Crude Oil (WTI)USD/bbl$66.26Down
Crude Oil (Brent)USD/bbl$69.88Down
Bonny LightUSD/bbl$70.68Up
Natural GasUSD/MMBtu$4.13Down
OPEC basket 02/12/21USD/bbl$70.03
At press time 4th December 2021

Oil and gas press agrees that in the short term we probably are better off waiting for the market to tell you which direction it is headed given the unforseen variables affecting global economic trends. Making assumptions on the future path of demand is further complicated by new waves of Covid infection and potential social and economic restrictions.

OPEC+ producer group agreed Dec. 2 to raise quotas by 400,000 b/d as planned, shrugging off market jitters over the emergence of omicron and US-coordinated releases from strategic petroleum reserves.

  • West Texas Intermediate crude for January delivery slipped 24 cents to settle at $66.26 a barrel in New York
  • Brent for February settlement rose 21 cents to settle at $69.88 a barrel

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