UBS expects oil prices will continue to rise, at least the short term.
U.S. crude oil jumped more than 1% to trade above $68 per barrel on Thursday, after Hurricane Francine churned through the Gulf of Mexico, disrupting oil production before making landfall in Louisiana."Hurricane Francine has likely disrupted about 1.5mn barrels of US oil production, which we estimate will reduce September production in the Gulf of Mexico by around 50,000bpd," Giovanni Staunovo, an analyst at UBS, told clients in a Thursday note.November contract: $71.
on Tuesday. Staunovo said the recent slump may be due to traders losing confidence in OPEC's ability to maintain compliance with production cuts at lower price levels."With likely further oil inventory declines ahead as supply lags demand growth, and given low speculative positioning, we retain our positive price outlook—we expect Brent crude oil to move back up above USD 80/bbl over the coming months," Staunovo said.
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