Over the past month, there has been a two percent increase in the price of crude oil globally in response to heightened geopolitical concerns. In reaction to what seemed to be an increase in hostilities between Israel and Iran, Brent crude prices broke through the $90/barrel barrier.
Ultimately, the bank anticipates a physically balanced market that may limit the magnitude of the possible downside during 2024 and 2025.
The likelihood of ongoing geopolitical tensions may cause the energy prices to trade with a positive bias in the near future.
In addition, the private lender increased its projected price for Brent by $5/barrel for Q2FY25 due to supply interruption and the premium associated with geopolitical risk.
‘’We raise our range from $75/bbl to $85/bbl in Q22024 to $80/bbl to $90/bbl to take in to account the geo-political uncertainty premium that could persist. A possible overshoot to the $95/bbl is possible in the near-term,” stated ICICI Bank.
