What’s Affecting Oil Prices This Week? (June 20, 2022)

While the oil prices declined last week, the price movement remains on the upward trend that started in December of last year. However, will the trend hold? Stratas Advisors explores in its latest oil price forecast.

John E. Paisie, Stratas Advisors
What’s Affecting Oil Prices This Week? (June 20, 2022)

If the trend does breaks, Stratas Advisors expects to see the price of Brent crude oil dropping towards $100 with an average forecasted Brent price of $96 for the third quarter and $88 for the fourth quarter. (Source: Shutterstock.com)

The price of Brent crude ended the week at $113.12 after closing the previous week at $122.01. The price of WTI ended the week at $109.16 after closing the previous week $120.67.

For weeks, we have been putting forth the view that oil prices would not move much above $120 because of a stabilizing supply situation coupled with moderating demand—and that there was substantial downside risk.  Now that the EU has agreed to ban the imports of Russia oil, we think that will be the last major announcement which will negatively affect sentiment pertaining to future oil supply.

With respect to oil demand, there is no doubt that elevated oil prices are negatively affecting demand from a global perspective and the strong U.S. dollar is further intensifying the impact for those countries who have seen their currency weaken against the U.S. dollar. And last week, the U.S. dollar strengthened further with the U.S. Dollar Index increasing to 104.65, which is the highest level since December of 2002.

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