Oil prices are expected to remain capped below $70 per barrel for the rest of the year, despite ongoing geopolitical tensions in the Middle East.

Analysts point to ample global supply and persistent demand uncertainty as the key factors keeping a lid on prices.

Growing supply from the OPEC+ group, although not as high as the headline figure of 411,000 barrels per day (bpd) suggests, is expected to create an oversupply in the market heading into autumn, even if summer demand holds strong.

On the demand side, the peak summer travel season may support higher supply, but lingering trade and economic uncertainties are likely to limit further price increases.

Currently, oil’s “normal” price would be in the $70s range, but market oversupply is keeping prices in the $60s, Senior Portfolio Manager at Tortoise Capital, Rob Thummel, told BNN Bloomberg.

"The market is currently oversupplied, which is keeping oil in the $60s. To get back to what we view as a normal price in the $70s, we’d need to see a more balanced market," he added.

Most analysts forecast that oil will hover in the mid-$60s and average below $70 per barrel through 2025.

SP/MA

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