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Oil Supply, Demand and Prices Become Clear

Oil Supply, Demand and Prices Become Clear

Despite the fog of war, global oil supply, demand, and prices have become obvious, according to new research from Enverus Intelligence Research (EIR), a subsidiary of Enverus, which was just given to Dailion.

According to the research, EIR now forecasts stock draws through 2022 until the fourth quarter of the current year, with demand growth weakening as reduced supply and easing demand bite as higher prices bite. In the research, EIR stated that its prediction for oil demand growth in 2022 has been half and that GDP downgrades will erode that view further in the following month.

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Brent’s price estimate is now “anchored” over $100 per barrel, according to the business, citing tighter balances as a result of the Ukraine conflict. The spike in Brent prices to $140 in March, according to EIR, drew attention to the concerns about oil consumption.

“With oil prices remaining stubbornly high since Russia’s late February invasion of Ukraine, we’ve slashed our demand growth forecasts by more than half this year,” Bill Farren-Price, the report’s lead author and director, said in a statement.

“We now expect global oil demand to grow by around 1.5 million barrels per day year over year in 2022,” he continued, “subject to additional modification as GDP forecasts are revised down.”

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“Avoiding Russian imports, which were down by about 1.5 million barrels per day in early March, European importers are avoiding technical issues and potential reputational damage,” Farren-Price stated.

Fitch Solutions Country Risk & Industry Research announced earlier this week that it has made a significant upward revision to its Brent oil price projection for the quarter. Analysts at Dailion said they now expect prices to average $100 per barrel in 2022 and $90 per barrel in 2023, according to a fresh report issued to the business.

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Brent is now selling at $102.09 a barrel at the time of writing. Brent closed at $100.85 per barrel on March 1, $127.98 per barrel on March 8, $98.02 per barrel on March 16, $121.6 per barrel on March 23, and $101.07 per barrel on April 6. Brent closed at $100.85 per barrel on March 1, $127.98 per barrel on March 8, $98.02 per barrel on March 16, $121.6 per barrel on March 23, and $101.07 per barrel on April 6.

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