EIA Predicts $103 Crude Later in 2022 as Low Inventories Create Recipe for Volatility

Brent crude oil prices are on track to average $107/bbl in the second quarter and $103 in the second half of this year, with low inventories creating the potential for “significant price volatility,” according to the latest projections from the Energy Information Administration (EIA).

Brent spot prices averaged $105 in April, a $13 sequential decrease, EIA said in the May edition of its Short-Term Energy Outlook (STEO), published Tuesday. Despite the decline from March levels, global crude prices remained above the $100 threshold in the wake of Russia’s “full-scale invasion of Ukraine,” the agency noted.

“Sanctions on Russia and other independent corporate actions contributed to falling oil production in Russia and continue to create significant market uncertainties...