ASX 200 energy shareholders will welcome this Blackrock forecast

Higher energy costs are being driven by supply constraints amid resurgent demand.

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S&P/ASX 200 Index (ASX: XJO) energy shareholders are likely to welcome some of the news coming out Riyadh.

The Saudi Arabian capital is currently hosting an investment conference of leading Wall Street businesses.

And when it comes to the outlook for crude oil prices, some of the biggest players are forecasting another 15% or more increase from the current multi-year highs.

Crude oil to US$100 per barrel could lift ASX 200 energy shares

ASX 200 energy shares like Woodside Petroleum Limited (ASX: WPL), Oil Search Ltd (ASX: OSH) and Santos Ltd (ASX: STO), have been among the biggest beneficiaries of rocketing oil and gas prices.

Gas prices in Europe and much of Asia are now at all-time highs.

And Brent crude oil, currently at US$86.09 per barrel, is trading at multi-year highs.

But global asset manager BlackRock thinks the price could go far higher.

Attending the conference in Riyadh, BlackRock’s CEO Larry Fink said (quoted by Reuters), “We’re looking at a high probability of $100 oil.”

Just 12 months ago, Brent crude oil was trading for US$40.46 per barrel.

Since then, the ASX 200 has gained 23%. But the big energy companies have done far better.

Over the past 12 months the Woodside share price is up 34%, the Santos share price is up 40% and Oil Search shares have gained 56%.

That’s reflected in the S&P/ASX 200 Energy (ASX: XEJ) index, which is up 32% over the past full year.

If BlackRock has this right, oil and gas stocks could enjoy some more healthy tailwinds over the coming months.

And there’s more…

Looking forward to getting back in the air?

Are you planning on flying somewhere once the restrictions are finally lifted? If so, you’re not alone. And that could put further upward pressure on oil prices.

According to Amin Nasser, CEO of Saudi Aramco, the world’s biggest oil company, global energy companies aren’t investing enough to expand oil-output capacity today to meet the expected big lift in demand.

“The spare capacity is shrinking,” he said (quoted by Bloomberg). “If there’s aviation pick up next year, that spare capacity will be depleted. It’s now getting to a situation where there’s limited supply – whatever is left that’s spare is declining rapidly.”

ASX 200 energy shares performance snapshot

We saw that the 3 ASX 200 energy shares named above have done quite well over the past 12 months.

More recently, the Santos share price is up 6% over the past month. The Oil Search share price is up 7% in that same time, while Woodside shares have gained 5%.

As for the ASX 200, it’s up just under 1% over the past month.

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The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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