Next Stop $100 Say Analysts, As Crude Prices Achieve Highest Close Since 2014

But Saudi Arabian Mining thinks lower prices will be sustained by the end of 2022: File Image/Pixabay

Oil prices on Tuesday for two key benchmarks achieved  their highest closes since October 2014 due to the ongoing analytical focus on the global energy crunch and pleas for the Organization of the Petroleum Exporting Countries (OPEC) to boost output seemingly being ignored.

Brent rose 41 cents to settle at $86.40 per barrel, while West Texas Intermediate ended 89 cents higher at $84.65.

Edward Moya, senior market analysts at OANDA, remarked, "Crude prices continue to rise and pleas to OPEC to increase production continue to fall on deaf ears; the only thing that will get OPEC+ motivated is if private U.S. operators signal they will increase production."

Moya added, "A jump to $90 oil seems likely" – a prediction eclipsed by the world's largest asset manager, BlackRock, stating on Tuesday there was a high probability of oil reaching $100.

This falls in line with Saudi Aramco on Tuesday warning oil output capacity across the world is dropping quickly and companies need to invest more in production.

Amin Nasser said, "If there's aviation pick up next year, that spare capacity will be depleted; it's now getting to a situation where there's limited supply - whatever is left that's spare is declining rapidly."

The question is, how long will the high prices continue?

Abdulaziz al-Harbi, CEO of Saudi Arabian Mining Co, said, "I think in the future there should be balance, in the near future, probably end of 2022, and I think prices are going, really, to sustain - but not at that high level."

Meanwhile, in order to reduce pressure from climbing energy prices, the government of South Korea has decided to temporarily slash domestic tax on key oil products by 20 percent, the biggest cut on record; according to Yonhap News Agency, the cut will help consumers save up to 2.5 trillion won over the six-month period.