Oil may hit US$100 amid China reopening, Iran’s Opec official says
OIL prices may rise to US$100 a barrel in the second half of the year, as China’s economy emerges from anti-virus lockdowns, Iran’s liaison to Opec said.
“We have some constraints in the market that could put pressure on prices,” Afshin Javan, Iran’s national representative to the Opec producer group, said on the sidelines of the India Energy Week conference in Bengaluru. “I think oil prices could go to US$100 per barrel.”
Oil prices traded near US$84 a barrel in London on Wednesday (Feb 8) after a rocky start to the year, as traders assess whether China can resume normal working life without suffering an overwhelming surge in Covid cases. Travel jumped during the Chinese New Year break, bolstering confidence in the outlook.
The Organization of Petroleum Exporting Countries and its allies are collectively known as Opec+. The group, which has fixed production quotas for the year ahead after making sharp output cuts, will likely stick with its current policy, Javan said. Opec+ opted to keep output levels unchanged at a monitoring meeting last week.
“I think Opec is moving in the right direction,” he said. The group is “in a really good and stable situation”.
His comments echo those of other Opec+ officials, who have said that the group aims to stick with the current targets until the end of 2023, or at least until the alliance’s next in-person meeting in June.
As national representative, Javan serves as part of Iran’s delegation to Opec along with governor Amir Hossein Zamaninia. He reports to Javad Owji, Iran’s minister in charge of oil.
Iranian Deputy Oil Minister for International Affairs Ahmad Asadzadeh said that the country has huge gas reserves that could help meet the world’s energy needs, if given adequate investment. Natural gas supplies became an urgent issue for consuming nations last year, after Russia interrupted exports following its invasion of Ukraine.
“If we have more foreign investment in the domestic market, we can really guarantee supply to other countries,” he said. “We’re ready to help everybody.” BLOOMBERG
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