By Adedapo Adesanya
Oil market analysts have forecast that the price of the commodity could reach $200 per barrel as a result of the ongoing Russia and Ukraine war.
British multinational bank, Barclays; Norweigian consultancy firm, Rystad Energy; and United States bank, Goldman Sachs all hiked their forecast as the market continues to face the continued one of the greatest shocks in recent times.
Barclays said disrupting most of the Russian seaborne crude supplies in its worst-case scenario could push prices above $200, although it did not revise its 2022 Brent forecast saying “the situation remains highly fluid.
Rystad Energy also said Brent could rise to $200 if Europe and the United States banned Russian oil imports.
Goldman Sachs hiked its price forecasts for Brent oil saying the world could be facing one of the “largest energy supply shocks ever” because of the Ukraine crisis.
The bank raised its 2022 Brent spot price forecast to $135 per barrel from $98 and its 2023 outlook to $115 from $105 per barrel.
“In the short term, coping with such a supply shock would require the combined help of global strategic reserves, core-OPEC, Iran and higher prices to reduce consumption,” Goldman said.
More than half of Russia’s March loadings so far were reported unsold and, if sustained, this could represent a 3 million barrel per day fall in Russian crude and product seaborne exports, the fifth-largest disruption in a month since World War II, the bank said in its note.
On Tuesday, the US announced a ban on Russian fossil imports including the oil in response to the country’s invasion of Ukraine.
Even before that, many buyers are reluctant to make purchases to avoid becoming entangled in sanctions indirectly, but the Joe Biden administration has said it could act alone in banning Russian oil imports.
“We’re banning all imports of Russian oil and gas and energy. That means Russian oil will no longer be acceptable at US ports and the American people will deal another powerful blow to Putin’s war machine,” President Biden said in a White House announcement yesterday.
Dipo Olowookere