What’s Affecting Oil Prices This Week? (June 13, 2022)

Despite oil prices reaching 13-week highs last week, here are the factors that Stratas Advisors said in its latest forecast are currently putting downward pressure on oil demand.

John E. Paisie, Stratas Advisors
What’s Affecting Oil Prices This Week? (June 13, 2022)

Coupled with the moderating demand, Stratas Advisors expects that the oil supply situation will stabilize but also thinks there is some potential upside to oil supply, including additional non-OPEC supply. (Source: Shutterstock.com)

The price of Brent crude ended the week at $122.01 after closing the previous week at $119.72. The price of WTI ended the week at $120.67 after closing the previous week $118.87. In recent weeks, we have suggested that oil prices would not move significantly higher than $120 over the next few months, in part, because our expectation that the supply situation would stabilize, and that global demand growth would remain moderate. 

While oil prices moved up last week, there are several factors that are putting downward pressure on oil demand.

Also, coupled with the moderating demand, we are expecting that the oil supply situation will stabilize. Given that the EU has recently agreed to ban the imports of Russia oil, we think that will be the last major announcement that will negatively affect future oil supply. While the EU is also working to implement a ban on insurers covering oil tankers (oil and refined products) that will be phased in over six months, we do not think the ban will have a major impact on Russian oil exports.

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