How Oil Prices Could Hit $65

Oil prices may tumble to $65 per barrel by the end of this year and to as low as $45 a barrel by the end of 2023 if the world enters a recession that would crash fuel demand, according to Citigroup.

The bank said in a report on Tuesday, cited by Bloomberg, that the assumptions for this forecast include a global recession, a lack of intervention by OPEC+ or some of its members to boost supply, and a drop in oil investments.

“For oil, the historical evidence suggests that oil demand goes negative only in the worst global recessions,” Citi analysts including Ed Morse and Francesco Martoccia wrote in the note. “But oil prices fall in all recessions to roughly the marginal cost,” the bank says, as carried by Bloomberg.