November 21, 2022 09:59 GMT
Reports from Goldman Sachs and UBS expect Brent crude to recover to 110$/bbl in 2023.
- Goldman Sachs cut its Q4 2022 Brent forecasts by 10$/bbl to 100$/bbl and is keeping the 2023 forecast unchanged at 110$/bbl according to a note on Sunday.
- The revision lower in Q4 is driven by China demand and maintaining Russian export flows. China consumption concerns due to rising covid cases were "another speed bump on the road higher" and Russian oil export flows have maintained at elevated levels despite the imminent implementation of the EU embargo.
- They see little changing in their structural outlook for 2023. "We still believe Russian production will decline about 0.6 million barrels per day from here, with risks of a deeper, more abrupt disruption, still present," the bank said.
- UBS also updated their forecast with Brent crude expected to recover to 110$/bbl in 2023. They expect oil demand to rise at an above trend rate of around 1.6mbpd next year.