Citi Raises 2025 Oil Price Outlook Amid Geopolitical Risks
Citi analysts have revised their 2025 oil price forecast upwards, citing geopolitical risks primarily stemming from Russia and Iran. They estimate that Brent crude will average $67 per barrel over the next five years, a significant increase from their previous projection of $62.
The bank's forecast also raises its average WTI crude forecast to $63 per barrel. They attribute these adjustments to heightened geopolitical risks that may disrupt the anticipated 2025 oil balance surplus.
Citi's quarterly Brent forecasts have been revised upwards as well: $75 per barrel in Q1, $68 in Q2, $63 in Q3, and $60 in Q4.
The Biden administration's recent sanctions on Russian entities, including tankers and oil producers, has prompted increased competition among major oil importers like China and India. This has led to a global scramble for ship supply as dealers seek tankers not subject to sanctions.
Meanwhile, President Trump's focus on maximizing oil and gas production could significantly impact the market in the coming years. Citi analysts emphasize the importance of monitoring the timing and nature of the administration's actions regarding Russia and Iran, as these factors will likely determine oil prices and market dynamics in 2025.