by Abisoye Shola……
The Chairman and Chief Executive of Orascom Investment Holding and the Chief Executive Officer of Naguib Sawiris have predicted that oil price will hit $100 per barrel in next 18 months.
According to reports monitored from an interview with CNBC, Sawiris said that post covid-19, the shale oil industry will experience a hiccup due to lack of funding from banks.
“I actually believe that in, let’s say, 18 months from now the oil will hit $100″ Sawiris said in a telephone interview.
“The shale industry will vanish for at least one year … and the start-up is going to be difficult because banks are going to be very reluctant to finance them back because they know that they’re very vulnerable … even [in] traditional oil many of the U.S. facilities have closed down” he said.
“The world is growing anyhow, even with this recession, so suddenly when the demand is still there and is coming … and they want oil, it will not be there because most of the people are shut down. So, the offering will be less than the need … and then the price will go back very high,” Sawiris continued.
According to the U.S. Energy Information Administration’s latest short-term energy outlook, which was released on April 7, Brent crude and WTI will average $45.62 and $41.12, respectively, in 2021. Standard Chartered currently believes Brent and WTI will average $44 and $41, respectively, next year.
According to experts the demand will be back up, but supply will not be where it normally would due to the shut-downs and the lack of investments and drilling
So far the Brent oil has been trading at around $29 per barrel and WTI was trading at around $24 per barrel.