Eni CEO expects Brent oil price to return to $80 in Q4

Brent crude prices will return to $80 a barrel in the fourth quarter, Claudio Descalzi, chief executive of Italian energy major Eni, said on Wednesday.

“Oil (is seen) at around 80 dollars per barrel, while for natural gas in Italy we can (expect a price of) 30 euros per megawatt hour,” Descalzi said on the sidelines of the Energy Summit conference organized by the daily of Italian business Il Sole. 24 of ore.

There is extreme volatility in oil prices, Eni’s chief executive said.

The supply chain does not support the demand of about 104 million barrels per day (bpd), Descalzi said, adding that while there is production potential, there are not many projects and investments in the upstream sector.

The “time to market” terms are too long, noted the executive.

Brent crude prices were trading just below $74 a barrel on Wednesday morning, down 1.6% on the day, as traders began to digest China’s massive stimulus that sent the oil market euphoric on Tuesday.

Brent at around $80 a barrel for the rest of the year is the call of most investment banks and analysts.

Macquarie revised down its forecast for Brent crude by $2 a barrel to $80 for the rest of 2024. Earlier this month, the bank cut its forecast for WTI crude by the same amount, expecting it to end in average at $75 per barrel for the rest of the year.

However, Macquarie expects the oil market to tip towards a surplus over the next five quarters due to weaker-than-expected demand.

Falling oil demand from China, high inventories and rising US shale production prompted Goldman Sachs to cut its forecast range for Brent oil by $5 to $70-85 a barrel.

Just two weeks after cutting its Brent estimate to $80 a barrel for the fourth quarter, Morgan Stanley has cut its forecast again, now expecting the international benchmark to average $75 a barrel in the last quarter of the year. Analysts at Morgan Stanley see headwinds from the demand side, which was their key reason for cutting their Q4 oil price forecast.

By Charles Kennedy for Oilprice.com

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