Fitch's research institute, BMI suggests that the US dollar could provide support for Brent crude oil throughout the year. The US dollar index (DXY) is predicted to remain mainly within the 100 and 108 range throughout 2022. DXY currently stands at 104.
A US economic growth slowdown and swifter-than-expected interest rate cuts might drive the dollar down. However, the ongoing US presidential election, increased geopolitical risks, and a generally tougher environment for risk assets in H2 2022 could potentially push the dollar higher, thereby boosting oil prices.
In terms of oil demand, BMI forecasts a 1.9 million barrels per day (bpd) increase this year. On the supply side, oil prices have generally been buoyed as OPEC+ continues to maintain tight control over the market.