Expect Brent to head lower, says Jonathan Barratt

A: I generally feel that USD 100 per barrel is a key psychological level but given demand and supply that certainly coming on to the market in the not too distant future, you cannot rule out that the price will be going lower. It has spent a little bit of time around USD 100 per barrel, maybe even deep down to USD 98 per barrel but at the end of the day we are seeing a lot more supply come on to the market and with the economics particularly in the EU and China are as strong as we expect them to be, I expect that supply would be the over influencing factor and their price should continue to trade lower.

Q: When you say that prices could trade lower, what would your year-end target for brent crude be because it has already fallen about more than 5 percent in the last one month?

A: It is always very hard to tell but I think if we can take guidance from the fact that the geopolitical events that we are witnessing at the moment, are doing very little to support prices. You get the sense that the market is looking at fewer economics and fewer demand for the next move. I think one of the important things is to gauge how the geopolitical events are paying on the price in the absence of any geopolitical events, you can see it down to USD 95 per barrel and perhaps even lower.