Brent crude oil futures were up $4, or 4.1%, at $102.02 a barrel by 0926 GMT. US West Texas Intermediate (WTI) crude was up $3.82, or 4%, at $98.86 a barrel.
Both contracts fell the day before, following an unexpected surge in US crude stockpiles and signs of progress in peace talks between Russia and Ukraine.
Morgan Stanley raised its Brent price forecast by $20 for the third quarter of 2022 to $120 a barrel, forecasting a drop in Russian output of around 1 million bpd from April. That decline will more than offset a downward revision to global demand of some 600,000 bpd, he noted.
Prices fell on Wednesday after news that US oil inventories rose by 4.3 million barrels in the week to March 11, to 415.9 million barrels, according to the US Energy Information Administration. .
The oil market did not take into account the decision of the US Federal Reserve to raise interest rates by a quarter of a percentage point, as expected.
Morgan Stanley raised its oil price forecasts, citing a “relentless drawdown in global inventories” and lower production from Russia, and projected Brent crude at $120 a barrel in the third quarter.
“As inventories are already at multi-year lows, we expect this to continue to put upward pressure on oil prices,” the entity said in a March 16 note.
The bank raised its Brent price forecasts to $120 and $110 a barrel for the last two quarters of the year, respectively, from $100 previously estimated.
Also, the 2023 crude forecast was revised to $100 a barrel from $95.
“We have lowered our production estimate for Russia by one million barrels a day, which is a drop from 11 million bpd to 10 million bpd from April,” the bank added.
Brent crude futures were trading at $102 a barrel on Thursday, after the International Energy Agency said 3 million barrels per day (bpd) of Russian oil and products could be off the market as early as next month.
The bank also cut its 2022 oil demand growth forecast to 3.4 million barrels per day (bpd) from 4.0 million bpd earlier, due to a resurgence of COVID cases in China.
He also forecast a 1 million bpd growth in Iran’s supply in the second half of 2022 for a possible nuclear deal that would release the Islamic republic’s crude to the market.
Source: Ambito
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