Oil market volatility spurs projections of US$100 per barrel – CARICOM Business
The International Energy Agency (IEA) raised its demand estimates by 200,000 barrel per day (b/d) for both 2021 and 2022, to reflect clear signs that impact on economic activity and oil demand from the omicron variant remained “relatively subdued.”
In its monthly oil market report, the IEA notes that world oil demand was seen rising by 5.5 million b/d in 2021 and by 3.3 million b/d in 2022, surpassing its pre-pandemic levels by 200,000 b/d to 99.7 million b/d. During the fourth quarter of 2021, the IEA said global demand “defied expectations” rising by 1.1 million b/d to 99 million b/d, an upward revision of 345,000 b/d compared to its previous report, also predicting that the oil market could face another volatile year.
The IEA’s latest report comes as oil prices hit fresh seven-year highs at over $88/b, supported by a growing consensus that oil demand and supply balances are tightening this year, with some market watchers predicting Brent futures will hit $100 per barrel later in 2022.
Extract from the CARICOM BUSINESS Newsletter, Vol 5 No. 4
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