Experts say oil prices could more than double to $250 a barrel by 2022, due to the disruption Russia’s war is causing to global energy markets.
In a ‘Financial Times’ report, two experts predict that the market will be hit by a supply shock caused by Russia’s war in Ukraine.
“We will not resume our normal activities for a few months”, explains to the publication Pierre Andurand, boss of a hedge fund specializing in energy. The expert also adds that he predicts that oil will hit $250 a barrel this year, as Europe loses Russian supply “forever”.
Doug King, head of the Merchant Commodity Fund, predicts the resource will rise in a range between $200 and $250 a barrel in 2022. “It’s not transitory. It’s going to be a raw supply shock,” he told the Financial Times.
Since the start of the invasion of Ukraine, oil prices have already risen sharply, as Russia is one of the world’s largest suppliers of this resource and produces around 10% of the oil the world uses every day.
It is recalled that US President Joe Biden had already announced in early March an embargo on imports of Russian oil and gas into the United States, in response to the Russian invasion of Ukraine.
In a speech at the White House, Biden said “this means Russian oil will not be accepted at US ports.”
The European Union, however, continues to receive Russian gas, as some countries in the region are particularly dependent on this resource, such as Germany, which is already trying to quickly reduce this dependence via other suppliers. The NATO summit on appeal today could lead to new energy sanctions.
Currently, Brent is down 1.4% at $119.94 a barrel and West Texas Intermediate (WTI) is down 1.7% at $112.97 a barrel.