Meanwhile, US West Texas Intermediate (WTI) futures for February delivery fell 28 cents, or 0.29%, to $85.55 a barrel, after falling almost a dollar earlier. The contract, which expires on Thursday, climbed as high as $87.91 on Wednesday.
The more active March-expiring WTI contract was down 15 cents, or 0.1%, at $85.65 a barrel. “The voices of those who forecast $100 a barrel of oil are getting louder,” said Tamas Varga of oil brokerage PVM.
Supply concerns have heightened this week after a fire temporarily halted flows through a pipeline from the Iraqi town of Kirkuk to the Turkish port of Ceyhan on Tuesday. Likewise, an attack by Yemen’s Houthis against the United Arab Emirates, the third largest producer of the Organization of Petroleum Exporting Countries (OPEC), increased geopolitical risks.
The market is also supported by tight supply from the OPEC+ producer group, made up of OPEC and its allies led by Russia. The International Energy Agency said on Wednesday that the group produced about 800,000 barrels a day below its production targets for December.
In 2021 oil prices rose 50%, and in this new year they will continue to rise, analysts warn. The price of oil could exceed US$100 per barrel, given the lack of production capacity and little investment in the sector.
At the moment, the Organization of the Petroleum Exporting Countries (OPEC) and its allies are gradually easing production cuts implemented in 2020 when demand plummeted and the price of crude fell below $0.
“We don’t want to see $100 a barrel. The world is not ready for that,” Oman Oil Minister Mohammed Al Rumhi was quoted as saying by Bloomberg. For its part, the financial Morgan Stanley projects that Brent oil will reach US$ 90 per barrel in the third quarter of this year, that is, between July and September.
EThe bank notes that the market will have little margin of safety with the prospect of crude inventories running out and spare capacity becoming scarce by the second half of 2022, and limited investments in the oil and gas sector.