JPMorgan said yesterday crude oil prices may hit $125 per barrel in the second quarter of this year.
The US-based global investment bank and financial services company said on the supply side the Organization of the Petroleum Exporting Countries (OPEC) and its allies, dubbed as OPEC+, is unlikely to deviate from its targeted oil production quota.
The world’s biggest oil producers of OPEC+ are experiencing difficulties in meeting their monthly production quotas.
The total oil production from OPEC+ rose in January by a modest 150,000 barrels per day (bpd), according to the International Energy Agency (IEA).
The global oil demand, however, is estimated to increase by 3.2 million bpd this year, the IEA said.
On the supply side, global oil consumption has skyrocketed with the normalization from the coronavirus pandemic, which caused crude prices to soar.
Also, the escalating tension between Russia and Ukraine has fueled oil prices.
The price of international benchmark Brent crude climbed above $96 per barrel earlier Monday, its highest level in approximately seven years.
The price of American benchmark West Texas Intermediate hit as high as $94.92 a barrel.*PNA