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Washington: Bank of America Global Research raised its forecast for the price of Brent crude for the current and next year, saying that an increase in the balance between supply and demand in 2022 could raise the price of oil to $100 a barrel for a short period.
The bank said in a note dated Sunday, “We believe that the pace of the strong recovery in global demand will outpace supply growth over the next eighteen months, to increase withdrawals from stocks and pave the way for an increase in oil prices.”
The bank raised expectations for the price of Brent crude to 68 dollars from 63 earlier. He expected the average price of crude to reach $75 next year, compared to previous forecasts of $60.
He pointed out that the deficit in the oil market will continue in the near future and will reach an average of 900,000 barrels per day in the next six quarters.
He expected a significant increase in oil consumption, reaching 5.6 million barrels per day this year and 3.6 million next year, the fastest pace since at least the 1970s.
Demand is expected to increase rapidly in the coming months, but the bank warned that the abundance of spare capacity in OPEC + and the possibility of Iranian oil returning will reduce prices this year.
Oil prices rose on Monday, boosted by strong summer demand and a pause in talks to revive the nuclear deal with Iran that could lead to the resumption of crude supplies from the OPEC member.