Last year was a rollercoaster for oil and many analysts anticipate continued volatility in 2023, but there are indications prices will remain strong this year.

The World Bank has forecast oil prices to average US$92 per barrel this year, which is well above the recent five-year average of US$60 per barrel.

The situation in Ukraine continues to cast doubt over supply as we head into 2023, with Russian oil production anticipated to fall as additional sanctions kick in.

The Organization of the Petroleum Exporting Countries (OPEC) stated in its December report it expects robust global demand growth in 2023, driven largely by China's relaxation of its zero-COVID policies.

Tentative signs of a "soft landing" in the global economy, combined with resilient demand data in China and the Middle East, also prompted the IEA to upgrade its 2023 demand outlook.

Production in the US, particularly from shale, is less certain than it has been in recent years adding further uncertainty to global supply.

The US, and other countries, also released large quantities of oil from their strategic oil reserves to combat rising oil prices in 2022 and the US Strategic Reserve is currently at its lowest level since 1984-reducing available buffers in the event of future disruptions to supply.

Carnarvon remains bullish in its view on oil prices and the imperative to manage reliable supply from the likes of the Company's Dorado and Pavo fields.

Attachments

Disclaimer

Carnarvon Petroleum Limited published this content on 20 January 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 19 January 2023 20:00:04 UTC.