JPMorgan slashes demand outlook amid soaring oil prices

  • JP Morgan has revised its forecast for oil demand this year down 1 million barrels per day.
  • JP Morgan forecasts total oil demand to average 100 million bpd in 2022, 400,000 bpd below 2019 levels

JP Morgan revised its oil demand forecast this year down 1 million barrels per day, citing high rates Oil prices.

By a report by Reuters, the bank meanwhile left its Brent price forecast unchanged at $114 a barrel for the current quarter and $104 a barrel for the year.

However, if another million barrels disappear from global supply daily, the bank added, Brent crude could add another $18 to $35 a barrel above its price target.

Bernard Looney, CEO of BP mentioned earlier this week, Russia had already lost 1 million bpd of production and could lose another this month.

“We now see total oil demand averaging 100 million bpd, 400,000 bpd below 2019 levels,” the bank’s analysts also said.

Meanwhile, prices jumped to over $110 a barrel for Brent and $108 for West Texas Intermediate after the European Commission announcement a proposal to impose a gradual oil embargo on Russia within six months for crude oil and until the end of the year for petroleum products.

Some EU members have expressed doubts about the move due to their heavy reliance on Russian oil imports. Exemptions are on the table. There are also other critics of this kind of embargo.

“In the short term, this could leave Russian revenues high while implying negative consequences for the EU and the global economy in terms of higher prices – not to mention the risks of retaliation (by Russia) on the supply of natural gas,” Belgian think tank Bruegel said. , following the EC announcement.

Whatever the EU decides, the sanctions would also include a ban on European companies providing shipping, insurance, brokerage and financing services to Russian oil producers, which would come into effect in a month. . It would also negatively impact Russian oil shipments to Europe, like the sanctions imposed on the country’s shipping industry earlier this year.

By Irina Slav for

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