A Reuters report quoted Citi as saying that it looks like in 2022 and 2023, Russian crude exports may remain robust even if refined product exports may fall. That said, further global crude oil demand weakness should spell higher inventories, which could weaken crude prices going ahead, Citi said.
The foreign brokerage sees Brent at $99 per barrel in the third quarter of calendar 2022 and at $85 a barrel in the fourth quarter. Overall it sees Brent price to average at $98 a barrel in 2022 and $75 in 2023.
In the case of WTI crude, Citi forecasts it to average at $95 per barrel in 2022 and $72 per barrel in 2023. It forecasts WTI crude to average $94 per barrel in the third quarter and $81 per barrel in the fourth quarter.
Citi Research had earlier in June raised its quarterly oil price forecasts for this year and its year-average outlook for 2023, as additional supply from Iran looked heavily delayed, adding to tighter market balances.
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The world oil demand is projected to average 100.3 million barrels per day (mb/d), which is 0.2 mb/d lower than the previous estimates and approximately 0.1 mb/d higher than 2019.
Crude oil markets have been gripped by many factors including recession, demand destruction, supply disruptions and rock-bottom spare capacity to name a few. It looks like volatility is here to stay in oil markets for a good period of time, said in a note.
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