Crude oil price forecasts
Despite the rise in oil prices on Friday, crude oil prices are trending to record weekly losses of more than 1%, the first of its kind in 3 weeks.
This came under the weight of investors ' fears of an increase in global supply due to OPEC policies, and the shock of unexpectedly high US inventories.
Crude prices in Friday trading
Transactions saw a slight increase in prices:
* Benchmark Brent crude: rose to the level of 66.85 dollars per barrel.
* West Texas Intermediate (WTI) crude oil: rose to the level of 63.25 dollars per barrel.
Bearish catalysts: OPEC and US stocks
There are two main factors behind the bearish pressures that the market is experiencing:
- Fears of an increase in OPEC production: traders are looking forward to the electronic meeting of the OPEC group on Sunday, and there are fears that any decisions to increase production will lead to a global oversupply.
- US stocks shock: data from the US Energy Information Administration (EIA) showed a sudden rise in crude inventories by 2.4 million barrels last week, while expectations were for a decrease of two million barrels. With this, stocks reached their highest level since early August.
We expect the decline to continue in the coming period, with some factors that may limit the sharp decline.
Factors that may limit the decline ?
Despite the downward pressure, there are supporting factors that may prevent the collapse of prices:
- The risks of disruption of Russian supplies due to Ukrainian attacks on vital energy infrastructure.
- Tightening of US sanctions: the most stringent set of sanctions is expected to lead to a restriction of Russian exports.
