Fitch Solutions Country Risk & Industry Research has left its Brent crude price outlook unchanged this month, a new report from the company has revealed.
The business currently sees the Brent price averaging $105 per barrel in 2022 and $100 per barrel in 2023, before dropping to $88 per barrel in 2024 and 2025, and $85 per barrel in 2026, the report highlighted. The price predictions are identical to company forecasts made in July.
“The month has seen oil prices coming under sustained downside pressure, with the front month contract averaging at around $105 per barrel, down from around $118 per barrel in June,” Fitch Solutions analysts stated in the report, which was sent to Rigzone on Wednesday.
“For most of the year price action has been dictated by firmly bullish supply-side drivers, but as recession risks continue to mount, demand-side concerns are creeping higher. Given that our economists are forecasting relatively robust economic growth over 2022 and 2023, we believe these concerns to be overblown,” the analysts added in the report.
“Assuming a recession is avoided and demand continues to grow as we expect, ongoing tightness in supply should see prices supported above the $100 per barrel mark. That said, the risks to our forecast are now increasingly skewed to the downside as high inflation continues to force rate rises, increasing the risk of a sharper slowdown in economic activity,” the analysts continued.
The Bloomberg Consensus, which was also highlighted in the report and which Fitch Solutions is a contributor to, sees the Brent crude oil price averaging $106.4 per barrel in 2022, $94 per barrel in 2023, $86 per barrel in 2024, $82 per barrel in 2025, and $82.1 per barrel in 2026.
At the time of writing, the price of Brent crude is hovering around $100 per barrel. Oil soared past $100 per barrel for the first time in years in February as Russian forces escalated a conflict with Ukraine. The Brent price has closed above $120 per barrel on several occasions this year, registering a 2022 high of $127.98 per barrel on March 8, but closed under $100 per barrel for the first time in months on July 12.
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