Brent Oil to hover around $70 as glimpses demand recovery – Danske Bank

The ongoing vaccine roll out, reopening of economies and growing inflationary pressure have brightened the outlook for oil prices. Strategists at Danske Bank expect Brent to average $70bbl in Q3 and Q4.

Watch virus spread in Asia

“Vaccine roll out, albeit with some bumps on the road, reopening of economies, strong support from monetary and fiscal policy and a relatively weak dollar have created a sound backdrop for global oil demand.”

“World oil consumption remains somewhat below the pre-pandemic level, but we are confident consumption will fully recover over the coming 1-2 years.”

“Spread of the virus in China and other parts of Asia will likely weigh on demand in short-term.” 

“OPEC+ has started normalising its oil output, which will ease the upside potential for oil prices from the sound demand backdrop.”

“We expect Brent to average $70bbl in Q3 and Q4 and $72.5bbl in 2022.”