Wall Street Journal (WSJ) reported on the 27th (local time) that Wall Street Investment Banks (IB) predicts that international oil prices will exceed $100 a barrel by the summer of this year.
According to the report, West Texas Intermediate (WTI) closed at $88.61 a barrel on the same day, up 15% this year alone.
The price of North Sea’s Brent oil on this day was $89.34 a barrel, up about 15%.
International oil prices, which rose more than 50% last year, continue to rise this year.
These high oil prices are expected to continue for the time being.
Morgan Stanley predicts that Brent oil will rise to $100 a barrel and WTI to $97.50 a barrel in the second quarter, respectively.
Goldman Sachs also predicted that Brent oil will rise to $100 a barrel in the second quarter and WTI will fall somewhat short of this.
Bank of America (BoA) boldly expects WTI to hit $117 a barrel in July and Brent Oil to hit $120, respectively.
WSJ explained that this era of $100 oil prices depends on how much COVID-19 will hurt oil consumption in terms of demand.
When Omicron, a COVID-19 mutation, was first discovered in November last year, concerns were raised that the blockade would be reproduced as in the delta mutation.
However, it is evaluated that the impact of Omikron mutation on demand is less than expected.
For example, in November last year, U.S. traffic volume increased 2.8% from November 2019, before the COVID-19 outbreak, the highest in the past decade.
On the other hand, there is not much room for further increase in oil supply and oil inventories are low.
Goldman Sachs predicts that oil inventories in developed countries will be the lowest in the past 20 years this summer.
Goldman Sachs analysts pointed out that low crude oil inventories and tight extra production capabilities have eventually been resolved by a sharp rise in oil prices in history.
