According to a report from UBS, the global wealth manager, Brent crude oil is expected to reach $95 a barrel by the end of 2023. UBS’s Chief Investment Officer for Global Wealth Management, Mark Haefele, stated that they consider oil to be their preferred investment and have revised their forecast upward from the current price of $77.90 per barrel.
Haefele also recommended selling volatility in Brent crude oil and highlighted the appeal of longer-dated oil contracts. UBS believes that these contracts, along with yield-generating structured investments, offer opportunities to generate durable returns.
In addition to oil, UBS suggested that investors should consider other real assets as part of a diversified portfolio. Haefele specifically mentioned infrastructure investments as a way to stabilize long-term income generation in a multi-asset class portfolio.
UBS remains optimistic about the impact of Saudi Arabia’s decision to cut oil production, expecting it to further support oil prices throughout the second half of 2023. Despite the relatively modest market reaction to the production curbs, UBS sees the cuts as a positive factor for price stability.
This forecast and recommendation from UBS reflect their assessment of the market and should be taken into consideration by investors interested in the oil sector and real assets.
