Brent Crude Oil should cost $95 again by the middle of 2023 – Commerzbank

FXStreet Insights Team FXStreet

A turbulent year is coming to an end in the oil market. Strategists at Commerzbank expect Brent Crude Oil to rise again in 2023 and trade around $95 by the middle of the year.

Significant tightening looms on the oil market

“We are convinced that oil prices will rise again strongly in the first half of next year, as the situation on the oil market is likely to tighten considerably.”

“Demand will exceed supply again from the middle of the year onwards and the already low inventories will fall further. We, therefore, think that the current price weakness is only short-lived and expect a significant price recovery in the coming months. By the middle of the year, a barrel of Brent Oil should cost $95 again.”

“In the unlikely event that prices do not recover, we expect further production cuts by OPEC+. In addition, the US government has announced its intention to replenish strategic reserves at a WTI price around $70. This should counteract a further slide in the WTI price.”

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

Markets move fast. We move first.

Orange Juice Newsletter brings you expert driven insights - not headlines. Every day on your inbox.

Editor's Picks

EUR/USD drops to daily lows near 1.1630

EUR/USD now loses some traction and slips back to the area of daily lows around 1.1630 on the back of a mild bounce in the US Dollar. Fresh US data, including the September PCE inflation numbers and the latest read on December consumer sentiment, didn’t really move the needle, so the pair is still on course to finish the week with a respectable gain.

GBP/USD trims gains, recedes toward 1.3320

GBP/USD is struggling to keep its daily advance, coming under fresh pressure and retreating to the 1.3320 zone following a mild bullish attempt in the Greenback. Even though US consumer sentiment surprised to the upside, the US Dollar isn’t getting much love, as traders are far more interested in what the Fed will say next week.

Gold makes a U-turn, back to $4,200

Gold is now losing the grip and receding to the key $4,200 region per troy ounce following some signs of life in the Greenback and a marked bounce in US Treasury yields across the board. The positive outlook for the precious metal, however, remains underpinned by steady bets for extra easing by the Fed.