Brent crude oil prices are expected to rebound to $80 per barrel in the fourth quarter, according to Claudio Descalzi, CEO of the Italian energy company Eni. He made this prediction during the Energy Summit conference hosted by the Italian business newspaper Il Sole 24 Ore on Wednesday.
Descalzi stated that oil prices should hover around $80 per barrel, while natural gas prices in Italy are expected to reach 30 euros per megawatt hour. He also highlighted the extreme volatility in oil prices. The current supply chain is struggling to meet a demand of approximately 104 million barrels per day. While there is potential for increased production, Descalzi noted a lack of new projects and investments in the upstream sector. He pointed out that the timelines for bringing new oil to market are too long.
As of early Wednesday, Brent crude was trading just below $74 per barrel, down 1.6% for the day. This drop came as traders reacted to China’s significant stimulus, which had initially boosted the oil market‘s optimism.
Most investment banks and analysts share the outlook of Brent crude averaging around $80 for the remainder of the year. Macquarie has adjusted its forecast for Brent prices down by $2 per barrel, now predicting an average of $80 for the rest of 2024. Earlier this month, they also reduced their estimate for WTI crude prices to an average of $75 per barrel for the rest of the year.
Goldman Sachs has also revised its expectations, lowering the projected range for Brent oil prices by $5 to between $70 and $85 per barrel. This change is influenced by weaker demand from China, high inventory levels, and increasing U.S. shale production.
Just two weeks after initially lowering its fourth-quarter Brent estimate to $80 per barrel, Morgan Stanley has cut its forecast again. They now anticipate an average of $75 per barrel for the international benchmark in the final quarter of the year, citing rising challenges on the demand side as the primary reason for this adjustment.
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