Oil Prices Could Soar To $100 Per Barrel In 2019, Predict Major Trading Houses 
Oil Prices Could Soar To $100 Per Barrel In 2019, Predict Major Trading Houses Representative image (Andy Buchanan - WPA Pool/Getty Images)

With Brent crude climbing above $80 a barrel after a tepid response from OPEC and its allies to the latest call by US President to boost output, major trading houses have warned that the prospects of oil prices soaring to $100 A Barrel By 2019 is now real.

Last week Trump had come out strongly against OPEC, saying that the US protects Middle East countries, and warning these nations that "they would not be safe for very long without us, and yet they continue to push for higher and higher oil prices! We will remember."

Trump's demand to rapidly ramp up oil production received a lukewarm response from OPEC with the group saying it would boost output only if customers requested it. This was in contrast to OPEC's positive response earlier this June to Trump' call. OPEC had then agreed to roll back production cuts it had proposed and pump an extra 1 million barrels a day.

Bloomberg quoted Saudi Energy Minister Khalid Al-Falih as saying that "the reason Saudi Arabia didn’t increase more is that all of our customers are receiving all of the barrels they want.” OPEC and its allies were expected to produce an extra 1 million barrels a day of crude to compensate for the shortfall in targets due to the prolonged economic crisis in Venezuela and U.S. sanctions imposed on Iran. But OPEC is on course to fulfil only half this target.

At the annual Asia Pacific Petroleum Conference (APEC) in Singapore, two major trading houses Mercuria Energy Group Ltd. and Trafigura Group said that the Brent could increase to $100 per barrel for the first time since 2014 as the market braces for the loss of Iranian supplies due to US sanctions.

Daniel Jaeggi, president of the commodity merchant Mercuria Energy Trading, said that the possibility of crude price spiking to $100 a barrel is real due to almost 2 million barrels per day (bpd) of crude taken out of the market as a result of the US sanctions against Iran.

Commodity analyst at Emirates NBD Edward Bell said that, "We expect that those OPEC countries with available spare capacity, led by Saudi Arabia, will increase output but not completely offset the drop in Iranian barrels."

JP Morgan said in its latest market outlook, published on Friday (21 September), that "a spike to $90 per barrel is likely" for oil prices in the coming months due to the Iran sanctions.

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