Oil Price Forecasts - Mar 9
Posted: Wed Mar 09, 2022 9:32 am
Moving forward I will be basing my forecasts on WTI averaging $100 in Q2, $110 in Q3, $100 in Q4 and $90 in 2023. This is based on the assumption that the Russian invasion of Ukraine says in Ukraine and does not spiral out of control. I do believe that Russia will find buyers for most of their oil.
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Goldman Sachs predicts a few scenarios where the price of oil could go a lot higher.
Even if temporary supplies come in the form of emergency releases from OPEC and the strategic petroleum reserve (SPR), the bank’s scenarios still see Brent anywhere between $115 and $175. < Keep in mind that the OPEC cartel has a solid relationship with Russia and it is in their best interest not to screw that up.
"Given a still intensifying military conflict, escalating Western sanctions and growing isolation of Russia, our subjective probability weighting of these potential outcomes currently leaves us base-casing a 1.6 million b/d disruption,” the bank wrote.
“As a result, we are raising our 2022 Brent spot price forecast to $135/bbl, with our 2023 forecast at $115/bbl, up from $98 and $105/bbl respectively,” it added.
The good news: With the economy still expanding, paychecks fattening and jobs still plentiful, a recession is not (yet) a done deal.
“Surging oil prices can't singularly trigger a recession and it would take more than sky-high energy prices for the consumer impact to become recessionary,” said David Bahnsen, CIO at The Bahnsen Group, a wealth management firm with over $3.5 billion in assets under management.
“The big question now is what the plans are to replace Russian oil in American and European supply needs and then how effective an embargo may prove to be in de-escalating the military situation in Ukraine,” Bahnsen added.
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Goldman Sachs predicts a few scenarios where the price of oil could go a lot higher.
Even if temporary supplies come in the form of emergency releases from OPEC and the strategic petroleum reserve (SPR), the bank’s scenarios still see Brent anywhere between $115 and $175. < Keep in mind that the OPEC cartel has a solid relationship with Russia and it is in their best interest not to screw that up.
"Given a still intensifying military conflict, escalating Western sanctions and growing isolation of Russia, our subjective probability weighting of these potential outcomes currently leaves us base-casing a 1.6 million b/d disruption,” the bank wrote.
“As a result, we are raising our 2022 Brent spot price forecast to $135/bbl, with our 2023 forecast at $115/bbl, up from $98 and $105/bbl respectively,” it added.
The good news: With the economy still expanding, paychecks fattening and jobs still plentiful, a recession is not (yet) a done deal.
“Surging oil prices can't singularly trigger a recession and it would take more than sky-high energy prices for the consumer impact to become recessionary,” said David Bahnsen, CIO at The Bahnsen Group, a wealth management firm with over $3.5 billion in assets under management.
“The big question now is what the plans are to replace Russian oil in American and European supply needs and then how effective an embargo may prove to be in de-escalating the military situation in Ukraine,” Bahnsen added.