HomeMediaLatest NewsThe oil price in 2024

The oil price in 2024

20 November 2023

Belogoryev Alexey M. Research and Development Director, Director of the Center for Energy strategic analysis and forecasting

Alexey Belogoryev, Research and Development Director of the Institute for Energy and Finance, commented to the Oil and Capital magazine on the factors influencing the world oil prices dynamics in 2023-2024.

Alexey Belogoryev said that events in the Middle East will have a much lesser impact on the price of oil than a number of other factors.

"We see almost indifference of the market to the confrontation between Israel and Hamas. Yes, there was a small spike in October, but it was more like a price correction against the background of a rise in September to $107. Now prices are fixed below $85 and I doubt that the fighting in the Eastern Mediterranean will greatly affect the oil production or export in the region.

As for Russia, the sanctions story has already been played out last year. In 2023, it has little effect on the global market and the actions of leading traders. They won't come up with anything particularly new against the Russian oil industry. Even if the price "cap" is tightened, it will change little. Now, if the United States began to impose secondary sanctions for violations by other countries of restrictions against the Russian Federation, then world oil prices would react, but Washington is unlikely to take such a step," the expert believes.

According to Alexey Belogoryev, it is more logical to pay attention to the supply-demand balance in the oil market. Unlike the factors described earlier, it can have a much stronger impact on the Brent value. At the moment, the supply is clearly lower than the demand. This is evident even from the dynamics of the decline in the volume of commercial stocks in a number of countries. But in the first quarter of 2024, the analyst says, it is quite possible that a surplus will appear.

In general, the analyst is confident that forecasts of $ 90-100 per barrel should be considered extremely optimistic. In reality, there are quite serious downside risks. Even the current prices of $83-85 are largely artificially supported by the policies of some oil-producing states, including Russia and Saudi Arabia. If it were not for the reduction in production from them, then today the cost of black gold could well be about $ 70.

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