Oil unlikely to hit one hundred dollar mark soon – Citi

Oil unlikely to hit one hundred dollar mark soon – Citi

Oil is unlikely to hit US$100 per barrel anytime soon, according to CitiGroup analysts, predicting the market will remain “well-balanced” in 2023.

OPEC+ states, which account for 40% of the world’s oil production, chose to cut output by over a million barrels a day in early April, prompting fears that prices could rise drastically.

“Cuts could assure a higher, tighter range-bound market near-term,” Citi said, but “expectations of US$100 plus oil are exaggerated”.

The bank predicted risks of lower demand and higher supply still remained, anticipating prices would begin to fall again later this year.

Oil sat at US$80.5 per barrel on Tuesday, having risen from US$65 in late March, before the OPEC+ cuts.

Downside risks are higher than upside potential, Citi added, with falling global GDP, which it had anticipated to sit at 2.3% this year and 2.5% next, likely to impact the oil market.

Published: 12-04-2023