Crude prices are likely to stay between $80 and $100 a barrel this year, according to Vitol Group, the world’s largest independent oil trader.
Consumption is set to grow by 1.9 million barrels a day in 2024, Vitol Chief Executive Officer Russell Hardy said Tuesday at the Financial Times Commodities Global Summit in Lausanne, Switzerland — a similar level to last year. Prices are also being supported by OPEC+ supply constraints, he added.
Oil at “$80 to $100 feels a sensible range for the market given the OPEC control of inventories around the world,” Hardy said. “It’s really a supply constrained market.”
Brent crude jumped above $90 last week as the backdrop of tight supplies and stronger-than-expected consumption was compounded by a spike in the geopolitical risks. Demand growth of 1.9 million barrels a day this year would be about 500,000 barrels a day higher than the International Energy Agency currently forecasts, and would mean that a previously anticipated slowdown in consumption growth this year would have virtually disappeared.
Other top traders speaking at the event in Lausanne have talked up oil’s prospects this week. On Monday, hedge fund Citadel said the market could get extremely tight in the second half of the year.
Vitol’s Hardy also said that Chinese oil demand will continue to grow in the short term, but that he expects a peak “fairly soon.”
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