Market complacency regarding Middle East conflict leaves WTI and Brent crude futures significantly underpriced, according to Energy Aspects' Amrita Sen.
Amrita Sen of Energy Aspects argues that current WTI futures are significantly underpriced due to market complacency regarding Middle East geopolitical risks. She suggests that given the intensity of hostilities, including Houthi attacks on energy infrastructure, physical crude prices should be trading closer to $150 per barrel.
The firm believes oil futures are underpriced and should be trading closer to $150 per barrel based on current geopolitical fundamentals.
As a global benchmark, Brent crude (UKOIL) is directly impacted by the same geopolitical instability cited by Energy Aspects. The article notes that the market is failing to account for the severity of attacks on regional energy infrastructure, which creates a fundamental upward pressure on global oil benchmarks.
According to Amrita Sen, futures markets are struggling to price in the true intensity of Middle East hostilities and their impact on physical crude fundamentals.
Energy Aspects founder Amrita Sen warns that current oil futures fail to reflect the true geopolitical risk in the Middle East. With Houthi attacks targeting critical energy infrastructure, Sen argues that physical crude prices should be trading closer to $150 per barrel.
Sen argues that the market is complacent regarding the intensity of Middle East hostilities, specifically Houthi attacks on energy infrastructure, which are not being accurately reflected in current futures pricing.