Brent crude oil could average $50 per barrel in 2021 due to a faster-than-expected demand recovery in sectors such as transportation as well as strong supply cuts from OPEC, The National news service reported on Sunday citing the Bank of America’s forecast.
According to the bank, Brent crude will cost an average of $43.70 a barrel this year, an increase on its earlier estimate of $37 per barrel as many countries lift the travel restrictions that were put in place to limit the spread of the coronavirus pandemic.
"Global oil market fundamentals have shifted significantly since we last adjusted our oil price forecasts on March 8,” the bank said in a statement on Sunday.
The Bank of America also revised its forecast for WTI up to $47 per barrel for 2021 and $50 per barrel in 2022. The bank based its assumptions on the return of US shale output to the market in the second half of 2021.
According to The National, Brent crude was trading at $ 41.02 on Friday, while WTI crude fell 0.6% to $38.49 per barrel.