Oil prices will surge to $140 per barrel by the end of this year, hedge fund manager Pierre Andurand said on Tuesday, adding that the recent slump was speculative on the back of the banking sector troubles.
Oil demand, even when it peaks around the end of this decade, will not head for a fast decline, Andurand said at the FT Commodities Global Summit.
"Even when we peak, oil demand won't fall down so fast. We will reach peak demand towards 110 million barrels per day and then a slow decline from there," the hedge fund manager said at the summit, as carried by Reuters.
Early this year, Andurand said that oil could exceed $140 per barrel yet this year if China's economy fully reopens.
At the FT Commodities Global Summit today, Amrita Sen, Director of Research at Energy Aspects, also expressed a bullish view on oil demand for the second half of 2023.
Demand in China is very consumer-driven after the reopening, Sen said at the summit, adding that gasoline and jet fuel demand are set to rebound.
"Jet is going to be the big story this year," Sen added.
Oil prices slumped by $10 per barrel in one week as the markets were roiled by the collapse of two banks in the United States and the near-collapse of Credit Suisse, which was subsequently saved by a takeover by domestic rival UBS.
Oil prices were trying to rebound early on Tuesday. Crude oil futures are finding a bid as short selling pressures start to ease, potentially raising the risk of a squeeze on a break above $75 Brent and $70 WTI, Ole Hansen, Head of Commodity Strategy at Saxo Bank, said on Tuesday.
Saxo Bank said early on Tuesday that "Crude oil, down around 12% this month, remains the biggest casualty among key commodities as the banking crisis and risks to the global economic outlook has led to short-term price and demand downgrades."
"In addition, the technical breakout of long-established ranges has forced major position changes from traders and investors," the bank's strategy team added.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.