World Bank upgrades oil price outlook for 2021-2022

The World Bank (WB) has significantly improved its forecasts for average oil prices for 2021-2022, to $56 and $60 per barrel, respectively, which is close to the average price for 2016-2019, according to the WB report on Russia's economy.

Report informs that the previous forecast of the World Bank for oil prices was $44 for 2021 and $50 for 2022.

The average oil price is projected to be $56 per barrel in 2021 and $60 per barrel in 2022, close to the average for 2016-2019, the document said.

The WB economists expect that the scaling up of vaccinations will contribute to a gradual increase in oil demand. This demand will be met by increasing production as part of the OPEC+ deal.

However, the alliance will still have large unused production capacity, limiting any further price increases, the bank's analysts warn. In addition, the price hike could lead to a rise in shale production in the United States.