Oil prices are supposed to rise this year as vaccines stimulate demand and OPEC + constrains supply, but the worsening COVID crisis in India and elsewhere poses a hurdle.
According to estimates, Brent is expected to be at average of $ 64.17 in 2021.This is also the highest view in the period since January last year.
It was seen that the demand for oil increased 5.5 million – 6.5 million barrels per day this year. This is in line with the cautiously optimistic picture drawn by the International Energy Agency earlier this month that producers may need to pump 2 million more barrels a day to meet expected demand.
The Organization of Petroleum Exporting Countries also raised its forecast, but some sources from the joint technical committee (JTC) pointed to the rising COVID-19 cases in India and elsewhere as a concern.
It is predicted that with vaccination practices gaining momentum this year, people are likely to go out again and businesses will fully reopen in the next quarters. In fact, this is already happening in the US and the UK, whis is supporting demand and pushing Brent to be about $ 75 in the second half.
By the way, the recent increase in COVID-19 cases in Europe, India and Brazil, along with the risks associated with rapidly spreading variants, could blunt the recovery in oil demand around the world.
India, the world’s third-largest oil consumer, is the hardest hit by the epidemic, and much of the country is currently under lock and key. However, some analysts say the impact may be limited.
The increase in Indian oil demand may be affected for at least a few months, but it may not pose a large enough obstacle to the recovery of global oil demand.
