January 27, 2023 13:27 GMT
Crude to Reach 100$/bbl on Russian Output and Chinese Demand: UBS
Sanctions on Russian oil products next month will likely limit oil output according to a note from UBS from 26 Jan.
- They see lower Russian output and higher Chinese demand driving oil prices above $100/bbl over coming months.
- Russia will find it more challenging to find buyers to compensate for missing European demand after sanctions are implemented on 5 Feb.
- Diversion of product flows to other markets may be restricted by the availability of smaller tankers and there may be a limit to extra Asian crude flows.
- They suggest Russian crude production could slip below 9m b/d in 2023.
- China’s reopening could increase global oil demand above 103mbd in the second half of 2023.