SEATTLE (Oil Monster): Crude oil prices could spike to above $100 per barrel in the run up to winter, Bjoern Jesch, global chief investment officer at DWS Group told Reuters.
Brent crude oil prices are trading around $93 a barrel , having scaled 10-month highs on Tuesday at around $95.96 as weak U.S. shale output compounded supply concerns over extended production cuts by Saudi Arabia and Russia.
“When you ask me about risk scenarios, there is high momentum in energy prices and what I do see as the risk, is that moving more to the colder months, probably there is an escalation,” Jesch said.
“I do see definitely a risk of spiking energy prices maybe over $100 for a short period of time.”
The speed of the recent gains also gave cause for concern said Madeleine Ronner, portfolio manager at DWS, leaving economies little time to adjust, especially in a scenario where the momentum was supply driven, as it is now.
“If it’s a slow increase, it’s much better, but if it happens as fast as it happens now, that’s more problematic,” Ronner said.
Over a longer horizon, Jesch expected more supply coming to the market and prices to come down.
The Deutsche Bank (DBKGn.DE) asset management unit DWS has 859 billion euros in assets under management, according to its website.
Courtesy: ww.reuters.com