Analysts: Oil prices could reach $ 100 as demand outstrips supply

Analysts predict that oil prices will continue to rise after jumping 50% in 2021, saying that lack of production capacity and limited investment in the sector could raise the price of crude oil to above $ 100 a barrel.

Although the Corona virus’s mutated Omicron has pushed infection numbers to much higher levels than last year, analysts say oil prices will continue to be buoyed by many governments’ reluctance to resort to re-enforcing the tough measures. that disrupted the global economy when the virus broke out in 2020

Benchmark Brent crude traded above $ 84 a barrel on Wednesday, reaching its highest level in two months.

“Assuming China does not slow down sharply, the Omicron has effectively disappeared. With OPEC + ‘s ability to increase production obviously limited, I see nothing stopping Brent crude from climbing to $ 100 a barrel, possibly sooner. “.

The Organization of the Petroleum Exporting Countries and other producers of the OPEC + alliance are gradually easing the production cuts that began when demand plummeted in 2020.

However, many smaller producers cannot increase supplies, and others are afraid of pumping large quantities in prediction of any new setbacks due to Covid-19.

On Tuesday, Bloomberg quoted Omani Oil Minister Muhammad al-Ramahi as saying the world was not ready to see an oil price of $ 100 a barrel.

And Morgan Stanley Bank expected Brent crude to hit $ 90 a barrel in the third quarter of quest’year.

Standard Chartered has raised its forecast for the price of Brent questeight dollars a year to $ 75 a barrel and $ 17 next year to $ 77 a barrel.

JB analysts expect Morgan will also raise oil prices to $ 90 a barrel by the end of quest’year.

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