Oil prices hit a seven-year high on Tuesday, with a barrel of Brent crude trading at nearly $106. However, according to the futures price, it is not very likely that oil will become cheaper in the coming weeks or months.
Brent crude traded at nearly $106 on Tuesday, its highest price in seven years. North American WTI crude oil also became significantly more expensive, approaching the hundred-dollar mark. Although the markets have partially absorbed the initial shock of the outbreak of war in Ukraine, the oil price is still rising slightly.
And judging by the futures development, we cannot count on an imminent cheapening. Brent crude for delivery in May rose by more than four per cent to just under $102 a barrel. April futures for North American WTI climbed more than three per cent and just missed the $100 mark.
“The very fragile situation in Ukraine, coupled with the financial sanctions against Russia, will keep oil prices above the hundred-dollar level. It cannot be ruled out that the price will go higher in the near term,” Louise Dickson, an analyst at Rystad Energy, told Reuters.
