Azernews.Az

By Trend

Global economy will suffer even with oil prices staying above $80 per barrel, Charles Ellinas, CEO of Cyprus-based energy consultancy e-CNHC told Trend.

The expert said that in general, it is possible for oil prices to reach above $100 per barrel.

"US sanctions are having an impact on Iran oil exports at a time when demand has just exceeded 100 million barrels per day. However, China's economic downturn and its trade war with the US may slow down its oil consumption, impacting global demand," noted Ellinas.

He pointed out that based on what is happening with China, Iran's ability to maintain some exports, Russia's promise to increase production and US steadily increasing production, the shortfall should be largely covered.

"In addition Saudi Arabia has just reassured the markets that it can supply more crude oil quickly if needed, by as much as 1 to 2 million b/d. Coming today, despite the Khashoggi developments, hopefully any more revelations will not derail it," said the expert.

However, Ellinas believes it is likely that there will be some shortfall, so he expects Brent prices will stay above $80 per barrel.

"Even if there is no significant hike, with prices staying above $80 per barrel the global economy will suffer, particularly in Asia, India and China, where most growth is. China's economy was slowing down before this - it is not likely to get any better. But the biggest impact may be on India," he noted.