Port Urban Varghese and Swati Verma
(Reuters) – Oil prices will rise slowly this year as demand for vaccines revitalizes and OPEC + supplies are curbed, a Reuters poll on Friday indicated, but the worsening Covid crisis in India and elsewhere poses some obstacles.
The 49-person survey predicted an average price of Brent crude at $ 64.17 a barrel in 2021, up from last month’s forecast of $ 63.12 and an average of $ 62.3 so far this year.
This is also the fifth consecutive bullish revision in the 2021 consensus and also the largest forecast for the period since January of last year.
“With the pace of implementation of vaccines accelerating this year, we expect that people will likely leave their homes again and businesses will fully reopen in the coming quarters – in fact, this is already happening in the US and UK,” which supports the demand and drives the analyst Giovanni Stonuovo. At UPS the price for Brent was around $ 75 in the second half.
Oil demand is expected to grow from 5.5 million to 6.5 million barrels per day this year.
This is in line with the cautiously optimistic picture presented by the International Energy Agency earlier this month, that producers may need to pump an additional 2 million barrels per day to meet expected demand.
India, the world’s third largest consumer of oil, is the hardest hit by the pandemic, with large parts of the country now under blockade. But some analysts say the effect may be limited.
“Oil demand growth in India will be affected for at least a few months, but it may not cause a significant enough drop to affect the recovery in global oil demand,” said Sofru Sarkar, an analyst at DBS Bank.