Oil may rise in 2023 due to Russian embargo-IEA
2022.12.14 04:50
Oil may rise in 2023 due to Russian embargo-IEA
Budrigannews.com – According to the International Energy Agency, demand exceeds earlier estimates and sanctions squeeze Russian supplies, causing oil prices to rise the following year.
The IEA, based in Paris, said in a report on Wednesday that Russia’s output, which defied the agency’s previous predictions that it would collapse this year, is likely to fall 14% by the end of the first quarter. The recent trend in oil futures, which have fallen to $80 a barrel in London after their worst weekly decline in four months, could be reversed if those forecasts are correct.
More Germany heavily dependent on raw material imports
The International Energy Agency stated, “While the full impact of embargoes on Russian crude and product supplies remains to be seen, lower oil prices come as a welcome relief to consumers faced with surging inflation.” It is impossible to rule out another price rally as we progress through the winter and toward a tighter oil balance in the second quarter.
The IEA, which exhorts significant economies, supported estimates for worldwide oil interest in 2023 by 300,000 barrels per day in the midst of overwhelming development in India and astounding flexibility in China. The average daily consumption will rise by 1.7 million barrels to 101.6 million the following year.
However, compared to previous messages from the agency, which a few weeks ago highlighted the risk of a supply squeeze and urged the OPEC+ coalition to reverse its latest production cuts, this is a softer price warning.
Despite its repeated predictions that a global boycott would reduce shipments, the IEA acknowledged that Russian exports have continued to rise. According to the report, despite Moscow’s oil shipments rising to a seven-month high of 8.1 million barrels per day in November, revenue decreased as a result of lower prices.
The IEA stated that OPEC+ cutbacks were shallower than anticipated due to Russia’s resilience. As many members were already pumping below their designated quotas, the 23-nation group led by Saudi Arabia reduced supplies last month by only a quarter of the 2 million barrels per day it had announced.
However, the International Energy Agency (IEA) predicts that global markets will tighten in 2023.
More Fuel demand in China has increased dramatically
The agency predicts that sanctions imposed by the European Union on Russia for its invasion of Ukraine will force the country to shut down approximately 400,000 barrels per day this month.
By the end of the first quarter, production will fall to 9.6 million barrels per day, down from 11.2 million barrels per day now. Last week, President Vladimir Putin said that Russia would cut back on production rather than selling to buyers at the price cap that the G-7 wanted.
In the meantime, “buoyant” gasoil consumption in emerging economies suggests that world oil demand will rise faster next year than anticipated. In recent months, India has led the expansion, but China will overtake it once more next year as the Asian powerhouse comes out of strict “Covid Zero” restrictions. the IEA declared
