Brent Oil could hit $100 but turning back lower to $80 over the course of the year – Commerzbank

Oil prices have risen by more than 20% since the beginning of the year. Strategists at Commerzbank are revising their oil price forecast for the first half of the year significantly upwards, but still expect prices to decline over the course of the year.

Concern about shrinking spare production capacities

“For the current quarter, we expect a Brent oil price of $90 per barrel (previously $80). The main reason is the sharp rise in the risk premium due to the Russia-Ukraine conflict, which is likely to recede only slowly.”

“We still see the oil price significantly higher in the second quarter at $85 (previously $75).”

“In the event of a Russian invasion of the neighbouring country, Brent is likely to rise significantly above the $100 per barrel mark, at least temporarily. Nevertheless, we expect oil prices to fall during the course of the year, as more oil is likely to reach the market thanks to the high price level.”

“The shrinking spare capacities due to the continuous expansion of oil production are an argument why we also see the price of crude oil in the second half of the year somewhat higher than before, namely at $80 per barrel (previously $75).”