2024-04-15 18:34:00
The price of a barrel of oil is expected to exceed $140 in this case
Giant banks’ expectations indicate that the Iranian strike on the Israeli occupation has increased the possibility of the price of a barrel of oil exceeding $140. According to a report reported by Reuters, the Iranian attack has increased geopolitical risks in the oil market in the near term, prompting some banks to raise their price expectations. In this context, on Monday, Citibank raised its forecast for the price of a barrel of oil in the short term from $80 to $88, based on the increase in prices as a result of risks.
According to Reuters, any comprehensive conflict between Iran and Israel might push oil prices to $100 per barrel. According to the bank, any decline in escalation may lead to a sharp decline in prices in a range ranging from the late 70s to the early 80s. As for Societe Generale Bank, it stated in a note today that crude oil prices in the foreseeable future will likely be affected by geopolitical risks.
French Bank Sokjin also raised its forecast for Brent crude to $91 in the second quarter and for US West Texas Intermediate crude to $87.5. It is expected that the average price of Brent crude will reach $86.8 and that West Texas Intermediate will reach $83.3 in 2024. Seokjin added: “We still consider direct US-Iranian military action a low risk, and the probability of its occurrence has increased from five to 15% with the rise in crude oil prices.” “Easily above $140 per barrel under this scenario.”
JP Morgan Bank stated in a note that expectations for oil appear to depend on any Israeli military response to the Iranian attack, adding that “other than the increase in the short term due to geopolitical conditions, our basic expectations for oil remain at $90 during next May.” In parallel, Kpler analyst Victor Katona said: “If supplies are interrupted unexpectedly, such as the interruption of Libyan supplies or Ukraine’s bombing of Russian port infrastructure with drones, it is certain that prices may get out of control once more and head towards $100.” per barrel.
Meanwhile, Brent crude futures for June delivery fell 81 cents, or regarding 0.9%, to $89.64 by 13:35 GMT, and West Texas Intermediate crude futures for May delivery fell 69 cents, or regarding 0.8%. %, to $84.97. Oil prices rose on Friday, in anticipation of Iranian retaliation. Britain, France, Germany and European Union foreign policy chief Josep Borrell joined the United States and United Nations Secretary-General António Guterres in calling for restraint in the Iran-Israel conflict.
Earlier this month, Ukraine targeted Russia’s third largest oil refinery with a drone. Reuters calculations indicate that regarding 14% of Russia’s refining capacity was halted due to drone attacks as the war in Ukraine entered its third year. Iran launched an attack on Israel with more than 300 drones and missiles late on Saturday in response to a suspected attack carried out by Israel on its consulate in Syria on April 1. The Iranian response was the first direct attack on Israeli territory, which raised fears of an expanding war in the Middle East. Two Israeli ministers indicated that a response to Iran would not be imminent, and that Israel would not act alone.
(Reuters, Al-Arabi Al-Jadeed)
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