Global oil benchmark Brent crude could rise by US$5 to US$20 a barrel relying on the severity of the Russia-Ukraine crisis, Bank of America (BofA) Global Research stated on Tuesday (Feb 22), including that costs could drop by US$2 to US$4 if tensions de-escalate.
Oil hit its highest since 2014 on Tuesday, with Brent futures reaching US$99.50 a barrel after Moscow ordered troops into two breakaway areas in japanese Ukraine.[O/R]
The financial institution sees Brent heading to US$120 a barrel by mid-2022, with fundamentals justifying a near-term spike and demand projected to rise by 3.6 million barrels per day (bpd) to surpass pre-pandemic ranges at almost 101 million bpd this yr.
“A weaker dollar trend and a pro-growth macro backdrop, if it indeed occurs, could support crude near triple digits in the second half of the year,” the financial institution stated in a analysis word.
A possible nuclear cope with Iran and related sanctions aid would rapidly translate into decrease oil costs, the financial institution’s analysts famous.
Analysts at BofA consider Brent costs might want to common US$60 to US$80 per barrel to maintain the worldwide oil market in stability out to 2027.