Goldman says crude oil prices will go to $140 in the next few months. In a worst-case scenario, they could surge to $380, according to JP Morgan. They're going to hit $130 in September according to the experts.
But Citi is not following the trends. The strategists at the investment bank think oil will fall by the end of the year.
The bank's head of European commodities strategy warned in a note to clients that oil prices could fall to $65 a barrel by the end of the year.
On the same day, oil prices plummeted, as investors worried that central banks' interest-rate hikes would cause economic growth to slow.
The timing was perfect according to Martoccia.
Even if there isn't a drastic slowdown, Martoccia and his colleagues expect oil to fall. The base case is that the price of global benchmark crude will fall to $85 a barrel by the end of the year, which would be 18% lower than Friday's price.
Even as the US and its allies batter the country with sanctions, Citi expects Russia to keep exporting and producing crude.
Russia's energy exports are expected to fall by the end of the year as the European Union restricts purchases. Russia's oil exports could fall further if the G7 caps Russian oil prices.
The logic is easy to understand. Russia will stop producing oil because it can't sell it. Oil prices will go up as buyers compete for the remaining supplies.
There is a different view taken by Citigroup. India and China will purchase more oil, keeping Russian oil pumping and easing the pressure on the market.
There isn't a supply crunch in the making.
In the fourth quarter of the year, crude oil exports to Europe will fall from 2.5 million barrels a day in the first quarter.
China will increase its imports by 2.3 million barrels a day and India will increase its imports by 950,000 barrels a day. Russia will be exporting more crude by the end of the year due to other economies lifting their purchases.
"I'm skeptical that the governments wouldn't listen to their own energy needs, because we have seen protests and riots around the world because of the increase in food prices and energy prices."
Demand is one of the main ingredients in oil prices. The world's appetite for oil is going to slow as the global economy cools, according to Citigroup.
Europe is likely to reduce its energy use. The eurozone is expected to fall into a recession as a result of soaring inflation. Germany has begun to dim its streetlights in order to conserve energy.
He said that the gas demand from the industrial complex in Italy or the orders of one of the biggest industrial facilities is going down. You have to see spillover effects in other places.
It is difficult to make oil price predictions. Russian production will fall and a Chinese economic recovery will increase demand, according to many analysts.
The bank is hedging its bets There is a 30% chance that oil will go back up to around $120 by the end of the year, according to it. It is hard to have a high conviction this year.
The strategist is waiting out the bear market in cash and liquid assets. She would need 2 opportunities to turn aggressive.
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