Brent: Here’s why oil could hit $80 by year end – JP Morgan

Dhwani Mehta FXStreet

Analysts at JP Morgan offer their take on why they expect oil prices to climb to $80 per barrel by this year-end.

Key quotes (via Barron’s)

The upcycle in energy prices is supported by a surge in demand as the world emerges from the pandemic and by “the unintended consequences of ESG [environmental, social and governance] and energy and transition policies,”

Such policies are “reducing fossil energy capacity faster than demand can switch to renewables.”

“Oil to surge beyond $80/barrel for Brent by year-end. Its 2022 year-end target is $62/barrel. “

“There is a risk of oil prices overshooting as the oil and gas industry reaches a tipping point due to chronic underinvestment.”

“Recommend investors to add commodity and commodity equity exposure to hedge the risk of more persistent inflation.”

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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