MOSCOW – Brent crude oil prices may reach the level of $70/bbl driven by events in Saudi Arabia but fundamental factors support a correction to $60/bbl and lower, experts say.
The oil price increase to level last seen in mid-2015 is just partly related to anti-corruption arrests in Saudi Arabia, analysts say. The news background is generally favorable for oil prices and Brent oil prices may be above $70/bbl for a short time, experts say. Nevertheless, oil prices will then go down to $60/bbl and lower, they believe.
“Oil prices are fueled by domestic political developments in Saudi Arabia, which may probably agitate the market for several weeks more,” says Georgy Vaschenko, director of operations on the Russian Capital Market at Freedom Finance. Vaschenko was quoted in a TASS report.
“Dramatic price spikes for raw hydrocarbons are possible during that time,” said Vaschenko. “The price may even reach $70/bbl in case of troubles with supplies from Saudi Arabia, although there are no signs of situation development under the worst-case scenario so far.”