The Russian invasion of Ukraine has sent oil prices soaring. Even if the war comes to an end in the near-term, strategists at Wells Fargo believe the West will continue to shun purchases of Russian oil for the foreseeable future. Consequently, they forecast that oil prices will remain elevated in coming quarters. 

West will continue to shun purchases of Russian oil for the foreseeable future

“Even if the conflict comes to an end in the near term, we think the West will continue to shun purchases of Russian oil for the foreseeable future.” 

“We have lifted our oil price forecast significantly and now look for the price of Brent Oil, a global benchmark, to average $140 per barrel in Q2-2022.” 

“We forecast that the price will slowly recede in following quarters due to the combination of demand destruction from higher prices and a ramp-up in supply from other major oil-producing countries, including the United States.”