April 17, 2024
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OIL & GAS

Too Early to Sustain $100 Per Barrel Oil – Rigzone report

It’s just too early to sustain $100 per barrel oil, according to Standard Chartered.

“It is highly likely that we see $100 at some point this year, however, we don’t expect it to stick,” a Standard Chartered analyst told Rigzone.

“We are forecasting a Brent average of $91 this year so any move above $100 would likely be brief. It’s just too early to sustain $100 – oil demand growth [is] limited this year and [the] macro backdrop [is] creating headwinds, particularly in H1,” the analyst added.

“[The] first year in which we think the average will be over $100 is 2025,” the Standard Chartered analyst continued.

In a report sent to Rigzone earlier this month, Enverus Intelligence Research (EIR) highlighted that, as of December, it projected Brent at $93 per barrel in the first quarter of this year and $108 per barrel in the fourth quarter of 2023.

In a research note sent to Rigzone in January, Goldman Sachs noted that it expects solid global oil demand growth of 2.7 million barrels per day in 2023 to push the market back into deficit in H2 and raise Brent to $105 per barrel by the fourth quarter of 2023.

The U.S. Energy Information Administration (EIA) expects the Brent spot price to average $80 per barrel in the first quarter of this year, $78.34 per barrel in the second quarter, $76.69 per barrel in the third quarter, and $75.36 per barrel in the fourth quarter, according to its latest Short Term Energy Outlook (STEO). The EIA’s latest STEO, which was released this month, highlighted that the Brent spot price averaged $100.94 per barrel in 2022.

Brent closed above $100 per barrel several times last year, peaking at a close of $127.98 per barrel on March 8, 2022. Brent then dropped from a close of near $123 per barrel in May 2022 to a close of just above $76 per barrel on December 9, 2022, before rising to a close of above $85 per barrel in January 2023.

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