Key Notes
In 2022, the price of crude oil fluctuated wildly, reaching a high of $130 per barrel in March during the Russian invasion of Ukraine. Currently, Brent International was selling at $83/barrel and West Texas Intermediate has been trading at about $80.
The price of oil has decreased by more about 23% over the past 6 months as a result of a weakening global economy, recent Chinese lockdowns, and a stable dollar.
We consulted analysts and oil professionals to get their predictions for the commodity in 2023 as we discussed what we should do in a bear market. Here are some of their estimates and the justifications for them.
Estimations for the average oil price/barrel:
Citi: WTI $75, Brent $80
By the way, our baseline scenario assumes that oil demand would increase by about 1.2 or 1.3 million barrels per day in the upcoming year. And in our basic scenario, supply will increase by double that amount from over course of the next year, with the US, Brazil, Canada, Guyana, Argentina, possibly Venezuela, and even Mexico contributing significantly to that growth.
JPMorgan: $90 for Brent
Their assumption that the OPEC+ coalition will carry the bulk of the load to maintain markets in equilibrium in 2023 justifies their projection of $90 for Brent. As Russian output fully maintains and a combination of conventional (Brazil, Norway, Guyana) and nonconventional projects (US, Canada, Argentina) supplies an additional 1.6 mbd, analysts anticipate that supply will expand at a rate that is 30% higher than the rate of demand in 2023.
OPIS: WTI $90, Brent $95-86.
WTI appears to average approximately $94.50 per barrel in 2022. We anticipate prices to be only marginally just below range in 2023, with $90 per barrel for WTI and $95 of between $96 per barrel expected for Brent. The effectiveness of China’s resumption and the capacity of western nations to avoid a significant recession will determine exactly how much these numbers rise above the average.
80–100 per barrel, according to Infrastructure Capital Advisors
While the conflict in Ukraine rages on, they anticipate oil to trade in the $80-$100 region. They also note that China’s oil consumption is likely to rebound as it exits its zero-COVID lockout stance.
