Crude Prices to Move Past $100 in 2013
Participants of a conference held in Singapore were recently told that the crude oil price per barrel will probably move over $100 by next year.
In the conference, it was mentioned that oil demand will most probably keep on increasing until next year, which will maintain optimism in oil markets unless some unanticipated shock happens, like a new downturn in the Middle Eastern economy.
Influencers of the crude oil prices have moved past basic market forces and are currently driven by uncertainty in the global economy, geopolitical problems and modifications to inventory outlooks. Events in the economy, like a recession in the eurozone, may reduce crude oil demand and weaken prices.
Further, it can be expected that increased demand from the crude and chemical sectors of Indonesia, Asia and India will use up additional crude and sustain a higher oil price per barrel in spite of increased OPEC production.
Geopolitical considerations influence the oil price per barrel even more than the usual fundamentals of supply and demand. High costs of crude would be influenced by upcoming refinery upgrades, while light crude will be affected by higher output of what is known as limited U.S. oil inventories.
However, even a rise in the output of the United States was not likely to trump global conflict as an influence on futures markets. Geopolitical factors can impact main oil-supplying nations like Syria, Iran, Iraq and Sudan, all of which have a bigger effect compared to the anticipated increase in U.S. tight crude production.