My expected oil price range for October West Texas Intermediate is slightly higher than it was for September, August, and July. I expect that WTI will range between $67.50 and $77.50 per barrel, an increase of $2.50 on the upper and lower range values. While oil prices might deviate from that range for a few days, I expect that WTI prices will fall within that range for most of the month.
The Iran sanctions, trade tensions and developments in Venezuela all continue to be important factors for determining oil prices. With the Iran sanctions officially starting in November, oil prices have begun to move upward. There are numerous articles stating that oil could reach over $100 per barrel by later this year or early next. While I am skeptical that an upward oil price move will extend that far, I want to wait to see how the market reacts in October to the looming November sanctions. In other words, I do not have a strong conviction on where the price range will be in several months.
On September 30, the Wall Street Journal article "Reignited Rally Sets Off Talk of $100 Oil" suggests that much higher prices are possible soon.
Oil prices are again marching higher, prompting talk that crude could reach $100 a barrel for the first time since 2015's crash.
Brent crude, the global benchmark for oil prices, jumped 4.1% in the third quarter to $82.72 a barrel, the highest level in nearly four years. Brent's fifth consecutive quarterly advance marks its longest such streak since 2008. U.S. crude edged down from its most recent multiyear high, falling 1.2% to $73.25 a barrel last quarter, though it has risen in five of the past six weeks. Investors have grown more bullish ahead of Nov. 4, the U.S. sanctions deadline for companies to stop buying Iranian oil.
Sentiment was bolstered, too, by the recent decision of the Organization of the Petroleum Exporting Countries and its allies to leave production steady. That move, analysts said, convinced investors that the removal of Iranian oil from the market, along with supply disruptions in places such as Venezuela, will lead to large crude shortages.
My October outlook is slightly higher than it was for the last three months. During October, we might gain a better appreciation of how the oil markets will react to the Iranian sanctions in November. Of course, I am still waiting to see how the trade tensions play out and how Venezuela manages in the months ahead. I continue to expect substantial price uncertainty over the next several months.