The oil freight industry is set to be busy in 2022, as investors are flocking back to the oil market, purchasing at the fastest speed for over a year.
According to a report by Reuters, portfolio managers bought 83 million barrels of oil in the week leading to January 11th, purchasing at the quickest rate for 14 months. A total of 184 million barrels have been bought over the last four weeks, following a sale of 327 million barrels in the preceding ten weeks.
As a consequence, Derik Andreoli, principal at Mercator International, told Logistics Management this rising demand on oil could boost prices.
“This wide range of [oil] price forecasts reflect unprecedented circumstances brought about not only by the COVID-19 virus and its many and growing number of variants, but also the various governmental, cultural, and personal responses,” Mr Andreoli stated.
While Goldman Sachs predicts oil prices could increase to $150 (£109.92) per barrel this year, Deutsche Bank has a much more conservative prediction that barrels will cost just $60 on average in 2022.
It seems the rising number of coronavirus infections due to the new, more rapidly-spreading Omicron variant, is not yet having an impact on the oil sector, with regards to investment or transportation.
Mr Andreoli asserts that opening up economies slowly would be more beneficial to avoid a surge in oil prices, as well as other costs.
By re-opening at a manageable rate, this will “avoid a significant run-up in the price of oil and all other commodities”.
Find out more about port agency services in Hull by clicking here.
