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A
survey of 30 economists and analysts forecast Brent crude would
average $89.37 a barrel in 2023, about 4.6% lower than the
$93.65 consensus in a November survey. The global benchmark has
averaged $99 per barrel in 2022.
U.S. crude is projected to average $84.84 per barrel in 2023,
versus the previous month's $87.80 consensus.
"We expect the world to slip into recession in early 2023 as the
effects of high inflation and rising interest rates are felt,"
said Bradley Saunders, assistant economist at Capital Economics.
Brent has fallen more than 15% since early November and was
trading around $84 a barrel on Friday as surging COVID-19 cases
in China depressed the outlook for oil demand growth in the
world's largest crude oil importer. [O/R]
"The oil market is still tight despite a weakening global demand
outlook as recession fears run wild," said Edward Moya, senior
analyst with OANDA, adding that China will be the primary focus
in the first quarter of next year.
Most analysts said oil demand will grow significantly in the
second half of 2023, driven by the easing of COVID-19
restrictions in China and by central banks adopting a less
aggressive approach on interest rates.
The impact of Western sanctions on Russian oil is expected to
minimal, the poll showed.
"We do not expect an impact from the price cap, which was
designed to give bargaining power to third-country buyers,"
analysts at Goldman Sachs said in a note.
Moscow this week signed a decree that bans the supply of oil and
oil products to nations participating in the Group of Seven (G7)
price cap from Feb. 1 for five months.
"In the event of a severe drop to Russian exports (which we do
not expect to occur), OPEC+ will likely be ready to increase
output to prevent prices from rising too high," data and
analytics firm Kpler said.
(Reporting by Brijesh Patel in Bengaluru; editing by Barbara
Lewis)
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