Oil price of $80–95/bl could be new normal in 2024

OPEC+ is prepared to defend $80/bl, but economic weakness and potential supply kept off the market will likely limit any upside as consumers acclimatise to higher prices, says Saxo Bank’s Ole Hansen

Elevated oil prices may be here to stay for the medium-to-long term, but it would take extreme geopolitical risks to push prices into triple digits in the immediate future, according to Ole Hansen, head of commodity research at Danish investment bank Saxo Bank. The oil market may well have found a new sweet spot in the $85–95/bl range, with consumers adjusting to the new price level and producers such as OPEC+ willing to defend a floor, Hansen told Petroleum Economist. The cross-commodity specialist also provided a reminder that energy prices drive inflation, not the other way around, and that higher commodity prices can persist in a recessionary period. What drives oil markets more, the mac