Brent crude prices expected to jump in Q2 2021: TexPro
27 Apr 21 3 min read
Owing to better fuel demand, average brent crude prices are expected to jump 6.5 per cent to $65 per barrel in the second quarter (Q2) of 2021, compared to average price of $61.03 per barrel in the first quarter, according to the US Energy Information Administration (EIA). Prices may again drop to $61 per barrel during the second half of 2021.
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A significant rise in brent crude prices has been observed in the month of February 2021. Price increased from $58.09 per barrel in the beginning of the month to $66.13 per barrel in the end. The major reasons behind the climb were higher fuel demand with strong US economic data, considerable fall in the US crude inventory, escalating tensions between the Yemen's Houthis rebels and Saudi Arabia, rare winter deep freeze causing closure of plants and refineries in Texas, weak US dollar and decision of the OPEC and its allies to further curtail the crude output, according to Fibre2Fashion's market intelligence tool TexPro.
In March 2021, crude prices dropped by 2.5 per cent from $66.13 per barrel at the end of February 2021 to $64.48 per barrel at the end of March 2021. This decline has been attributed to strengthened US dollar, rise in crude inventory, retreating fears of oil supply disruption in Saudi Arabia after the attack on its export facilities, and lockdowns to fight against the 2nd and 3rd wave of the pandemic in some states of the US, the EU, and other countries along with a halt in the vaccination process.
The highest price of $68.50 per barrel in the last three months was recorded in the 2nd week of March 2021. This rise has been supported by fall in gasoline and distillate inventories and global vaccine rollouts. The OPEC and its allies also decided to extend the crude oil production cuts. The expectations of global economic recovery after the approval of the $1.9 trillion stimulus bill by the US Senate underpin the price rise.
The prices of crude again recovered in the month of April 2021 to $66.11 per barrel (on 23rd April 2021) with a surge of 2.53 per cent over $64.48 per barrel at the end of March 2021. In April 2021, EIA and the American Petroleum Institute (API) reported a crude oil inventory draw. The tensions in Middle East have been escalated after the Yemen-based Houthi rebels stated to have fired missiles on Saudi oil sites. The US dollar again weakened in April 2021.
Fibre2Fashion News Desk (RKS & JL)
This according to Fibre2Fashion's Market Intelligence Tool - TexProPopular News
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