Enermgy Markets: Three scenarios for oil ans gas, prices to rise even further – ABN Amro
|Gas prices have reached new records. At the same time, oil prices reach new record highs in euro terms. ABN Amro’s three new scenarios imply that oil and gas prices will either remain high or go even higher.
Base case
“Physical supply disruptions are already happening, and we now see these disruptions getting worse over the coming months. We expect that some supply disruptions could continue for at least a year. Due to the higher prices, self-rationing of demand will occur. Note, we do not assume a complete cut-off in Russian oil and gas supplies to Europe in this scenario.”
Negative scenario
“We do expect a full Russian supply disruption. This means a full ban of exports of both Russian oil and gas. Furthermore, we expect this situation to remain in place for longer (up to two years). Even higher energy prices will result in lower demand.”
Positive scenario
“We expect a more rapid trade re-alignment (disruptions lasting six months). We ascribe only a low probability to this scenario. Even if sanctions may be lifted at some point in time, we expect a large part of the self-sanctioning will remain in place. Even in this scenario, energy prices could continue trading higher for longer compared to pre-pandemic price levels.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.