Global Oil Demand in 2022, very Promising -Jadwa announce, in a revised forecast

Forecasts for the Year 2022 are very promising, Jadwa Investment Company stressed, adding that despite the slight stagnation in oil demand growth, in the first quarter of 2022, the forecasts for the remainder of the year are very promising, as the three major energy agencies (OPEC, US Energy Information Administration, and the International Energy Agency) expect the global demand for oil to reach record levels by the 4^th quarter.

And since there are no significant increases, in the US oil supplies, in the near future, Jadwa pointed out that it is likely that the spare capacity of OPEC and its partners will attract more attention, during the next few months.

Dwindling spare capacity for oil production, and the decline in the levels of commercial oil stocks to below their average, which have recently fallen below their average for 10-year, will lead to support for oil prices over the course of 2022, it explained, noting that despite the occurrence of a breakthrough in the negotiations between Iran and world powers, could lead to a million barrels per day of oil reaching the market, at some point during the year, but such a deal is still a long way off.

Jadwa revised its forecast for Brent blend, the world benchmark’s prices for the Year 2022 to $76 a barrel, compared to its previous forecast, which indicated a record of $71 for the Year 2022 as a whole, a positive difference of up to 5-Dollars.

Adding that Brent blend prices jumped by 8%, on a quarterly basis, in the Q4 of 2021, to reach their average of $80 a barrel, and since, prices have recorded more rise and currently Brent blend is trading at more than $85 a barrel, recording its highest level in 7- year, although part of this rise is related to the decline in concerns over the impact of the Omicron on global oil demand.

But it is also partly related to some geopolitical events in major oil-producing countries.

Besides the internal turmoil in Kazakhstan a few weeks ago, tensions escalated in the Gulf, where there were a series of maritime accidents and a recent drone attack on oil tanks in the Emirates.

In addition to that, there is a continuous escalation of tensions around the Crimea, on the Russian- Ukrainian border, with potential repercussions on a larger scale for oil and gas supplies to the continent, Europe should be noted that gas prices in the region have fallen from their recent record levels, nonetheless, they kept remaining high.