A rally in oil prices could stall as recession fears and COVID flare-ups in China slow demand and counter supply risks; from sanctions on Russia and OPEC+ output constraints, a Reuters poll showed.
A survey of 35 economists and analysts forecast Brent crude would average $105.75 a barrel in 2022, down from a forecast of $106.82 in June marking the first downward revision to the monthly poll since April.
The global benchmark has averaged about $105 a barrel this year. The demand growth forecast for this year was also slashed to a range of 1.4 to 2.5 million barrels per day (bpd); from 2.3-5 million bpd in the previous poll.
Rapid interest rate hikes from major central banks coupled with travel restrictions in China, the world’s biggest crude importer; have soured the oil demand outlook, analysts said.
The next meeting of the Organization of the Petroleum Exporting Countries and allies including Russia, together called OPEC+; is set for Aug. 3 and will be closely watched as their current output pact expires in September; and the United States has stepped up calls for more production