Volume IconCrude oil prices to remain in nervous 90s for now

Crude oil prices surged 10% in the past month. Business Standard's Puneet Wadhwa speaks to Paul Hickin, a director at S&P Global Platts, on how crude oil prices will play out in the days to come

ImagePuneet Wadhwa New Delhi
Paul Hickin, director, S&P Global Platts

Paul Hickin, a director at S&P Global Platts

Q1: How do you see the Ukraine crisis impacting the world oil markets in the short-to-medium term?

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>Expect a lot of twists in the Russia – Ukraine story
>Oil demand to hit 4.3 million barrels per day (bpd) in 2022 amid tight supplies
>Global shale production still limited
>Geopolitical disruptions more pronounced now
>Current prices are at $20 a barrel premium to where they should be

Q2: Oil prices have slipped from around $97 a barrel to around $94 now. Will the relief by short-lived?
>Dated (physical crude oil for delivery) hit $100 a barrel this week
>Prices to stay in early 90s in the next one month
>S&P Global Platts sees oil below $80 by 2022-end
>Shale production likely to pick up
Q3: A lot of experts see oil at $125 a barrel by June 2022. Are these estimates realistic?
>Bullish narrative in the market due to limited supply, geopolitical concerns
>Risks to oil prices has seen investment banks give aggressive forecasts
>Need to assess how oil prices will incentivise alternate fuel sources
>Oil prices will remain volatile in the short-term and hover in the nervous 90s
Q4: So what’s the contingency plan, according to you, that most countries are adopting to circumvent the crisis in the oil market?
>OPEC+ trying to match supply with demand
Q5: How do you see OPEC+ respond to these developments?
>OPEC+ wants to create demand-supply equilibrium
>Shale gas key to bringing prices under control

First Published: Feb 18 2022 | 08:00 AM IST

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