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Daniel Yergin, vice chairman of S&P Global and a prominent authority on energy markets, has reportedly said 2023 will be the “year of central bankers,” and the timing of their decisions to alter interest rates will be the “key thing to watch” in projecting energy prices.
According to a report on Nikkei Asia, Yergin said he anticipates volatility to continue in the markets. “It’s so uncertain what will happen, [with the] Ukraine war, and what the consequences would be because Putin is determined to win and the West is determined that he will not win,” he said.
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The year 2022 was an upbeat period for oil as persistent supply concerns from Russia kept prices high for much of the year. The United States Brent Oil Fund BNO gained over 33% in the last year while the Vanguard Energy Index Fund ETF VDE gained over 51% in the same period.
“I think the key thing to watch is when the central banks decide they’ve done enough to squeeze out inflation… because that clearly is weighing on the global economy, and the global energy market and financial markets,” Yergin added. The expert pointed out that in his base case, Brent prices will be around $90 per barrel for 2023.
Price Cap: Yergin called the price cap on Russian oil a “very dramatic example of collective action.”
“The balance has changed because the role of the U.S. has changed so dramatically … [it] has gone from being the world’s largest importer of oil to being the world’s largest producer of oil and natural gas,” he said, according to the report.
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Image and article originally from www.benzinga.com. Read the original article here.