According to a survey of analysts compiled by The Wall Street Journal, oil prices are expected to increase from their current levels throughout the year. The forecast shows that Brent crude, the international oil benchmark, is projected to average $82.26 a barrel in the first quarter, which is over $4 higher compared to present levels. However, this is slightly lower than previous analyst expectations of $84.30 a barrel. For the fourth quarter, analysts forecast an average price of $83.82 a barrel for Brent crude.
Meanwhile, WTI, the main U.S. gauge, is expected to have an average price of $78.02 a barrel in the first quarter, down from previous expectations of $80.76 a barrel. The survey suggests that WTI prices will rise to $79.73 a barrel in the fourth quarter.
Currently, oil futures are facing weekly declines due to several factors, including advancing ceasefire negotiations between Israel and Hamas and concerns over China's economic growth. Despite these challenges, support from continued tensions in the Middle East and OPEC+ maintaining its production policy has helped to stabilize prices. As of now, Brent crude is priced at $77.81 a barrel, reflecting a decrease of 1.2%, while WTI stands at $72.76 a barrel, down 1.5%.
Analysts at Commerzbank Research highlight that the risk of an escalation remains high, which could impact oil prices positively. Additionally, the tight supply contributes to Brent crude's resilience despite weaker demand.
Negative market sentiment has also contributed to the decline in oil prices. The U.S. Federal Reserve's decision to keep rates unchanged and dashed hopes for rate cuts in March have weighed on the commodities complex.
Overall, the survey paints a picture of rising oil prices throughout 2022, albeit slightly lower than initial expectations due to various market factors.
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