The continued production cuts by OPEC+ and the escalating Russia-Ukraine conflict are key catalysts that could drive oil prices above $100 per barrel in the coming months.

The steady upward trend in oil prices has sparked speculation that 'black gold' could reach $100 per barrel if current market conditions persist.

WTI crude oil futures are currently trading above $86 per barrel, while Brent crude has also risen above $91 per barrel, the highest level since October 2023.

Futures prices have surged above the critical $90 per barrel mark amid escalating conflict in the Middle East.

“There are many geopolitical reasons to be concerned about supply risks,” said Claudio Galimberti, Senior Vice President at Rystad Energy, in an interview with Yahoo Finance about the recent oil price trends.

Galimberti added, “Therefore, I think that reaching triple-digit oil prices is not far off at this point. It is definitely achievable in the coming months.”

Galimberti pointed out that factors such as OPEC+ continuing production cuts and the escalating Russia-Ukraine conflict are the main catalysts driving prices above $100 per barrel in the next few months.

However, the analyst also noted that ample spare capacity and the ability to increase oil production in the Middle East could help curb the price rise.

Last month, Russia announced deeper oil production cuts, leading JPMorgan analyst Natasha Kaneva to forecast that Brent crude oil prices could hit $100 per barrel by September.

Kaneva and her colleagues wrote in a note: “Russia’s actions could push Brent crude prices to $90 per barrel in April, average $90 per barrel in May, and approach $100 per barrel by September.”

However, Kaneva also predicted that Brent crude would trade at $90 per barrel in May and $85 per barrel in the second half of the year, as countermeasures come into effect if prices rise too high.

For example, the U.S. might choose to release oil from its strategic reserves, Russia might maintain current export levels, or demand might decline.

JPMorgan’s analysis team wrote: “The lessons from the 2022 energy crisis have taught us that there are effective levers to mitigate the impact of high prices. Our view remains that with a stronger USD and higher borrowing costs, oil prices exceeding $90 per barrel could cause significant disruptions to global oil demand—as seen in March-June 2022 and September-October 2023—creating a lower price environment.”

WTI crude oil prices have increased by 23% year-to-date, while Brent crude has risen nearly 20% in the same period.

Source: Vietstock