UBS Raises Oil Price Forecast
October 14, 2021
The API report came out a day late and said that crude oil stocks were up 5.2 million barrels, gasoline stocks were down 4.6 million barrels and distillates were down 2.7. Cushing crude oil stocks were down 2.8 million barrels.
UBS in a research note to clients said they have raised their price forecast for Brent to $80 and WTI to $77 over the next 12 months, some $5 higher than its previous forecast. As a result of higher crude demand in the power sector and US jet fuel consumption. They expect the elevated prices will result in more pressure on OPEC+ to boost production at a faster pace.
Citigroup said it was raising its price forecast for Brent in the fourth quarter to $85 and warned prices could touch $90 at times this winter.
The Energy Information Administration projected in its Winter Fuels Outlook that US consumers will spend more to heat their homes this winter from October through March than last year due to higher energy commodity prices. It said households that use propane and heating oil will likely spend much more than last year. Fill up your propane tank now.
The outlook for today’s propane inventory update is for stocks to build by 376,000 barrels.
Saudi Arabia dismissed pleas by the US and other consumer nations to raise output saying it isn’t needed. They are still concerned that COVID could impact demand.