According to Deutsche Bank strategists, Brent Crude Oil is projected to break above $80/bbl this year, but will retrace considerably in 2022.
“We believe underlying strength will support further rises this year, with Brent likely to breach over $80 per barrel.”
“Our main argument is that OPEC will not introduce any additional supply beyond the predicted Iranian levels beginning in September.”
“There are reasons not to extend the strength of the rise toward $100/bbl, and we expect Brent to retrace to $75/bbl in Q4-22.”
“The call on OPEC will be restrained by a sluggish but incremental US supply response, Iran should ultimately reach an agreement to reintroduce supplies later this year, and OPEC members may complain louder for quota hikes around the May 2022 provisional deadline,” says the report.
“On the one hand, uneven vaccination and the difficulties in establishing international vaccine certificate standards may stymie long-haul air passenger travel, while herd immunity may be out of reach due to new variations’ increased transmissibility.”/n
