U.S. crude oil costs rose marginally on Tuesday, because the U.S. Vitality Info Administration raised its world oil demand progress forecast for 2024 whereas OPEC maintained its outlook for comparatively sturdy progress this 12 months.
In its latest Short-Term Energy Outlook, the U.S. Vitality Info Administration raised its forecast for 2024 world oil demand progress to 1.1M bbl/day from its earlier estimate for a 900K bbl/day improve, whereas reducing its 2024 estimates for benchmark crude costs by ~4%.
The EIA stated it sees spot Brent averaging $84.15/bbl in 2024, down from its earlier forecast of $87.79/bbl, and WTI averaging $79.70/bbl, vs. its earlier view of $83.05, however it forecast Brent rising to $85/bbl on this 12 months’s H2, as OPEC+ extends voluntary manufacturing cuts by way of Q3.
“Though crude oil costs initially fell following the OPEC+ announcement, we count on the extension of all voluntary cuts by way of 3Q24 will trigger world oil inventories to proceed falling by way of 1Q25 and put upward stress on oil costs over that interval,” the EIA stated in its report.
In the meantime, OPEC+ stated in its monthly report that continues to forecast oil progress demand this 12 months at 2.2M bbl/day and subsequent 12 months at 1.8M bbl/day, unchanged from final month’s outlook, with non-OPEC+ provide seen rising by 1.2M bbl/day in 2024 and 1.1M bbl/day in 2025, each the identical as estimated in Could.
Entrance-month Nymex crude (CL1:COM) for July supply closed +0.2% to $77.90/bbl, and front-month August Brent crude (CO1:COM) closed +0.3% to $81.92/bbl.
ETFs: (NYSEARCA:USO), (BNO), (UCO), (SCO), (USL), (DBO), (DRIP), (GUSH), (NRGU), (USOI)
Morgan Stanley analysts stated they count on Brent crude costs will rise by ~$5/bbl this summer however warned {that a} development towards tightening provide within the subsequent three months will give method to surpluses towards year-end 2024 and into 2025.
As soon as Q3 ends, the financial institution sees seasonal tailwinds turning into seasonal headwinds, noting refined product demand tends to drop by a mean 3.9M bbl/day within the September-through-January interval, making for a troublesome atmosphere to rally.
Morgan Stanley’s pricing deck for Brent crude signifies $86/bbl in Q3, easing to $85/bbl in This autumn earlier than sliding to $81/bbl firstly of 2025 and $76 by the tip of subsequent 12 months.
With out additional motion by OPEC+, Morgan Stanley analysts imagine 2025 will see a “persistent” surplus.
U.S. crude oil costs rose marginally on Tuesday, because the U.S. Vitality Info Administration raised its world oil demand progress forecast for 2024 whereas OPEC maintained its outlook for comparatively sturdy progress this 12 months.
In its latest Short-Term Energy Outlook, the U.S. Vitality Info Administration raised its forecast for 2024 world oil demand progress to 1.1M bbl/day from its earlier estimate for a 900K bbl/day improve, whereas reducing its 2024 estimates for benchmark crude costs by ~4%.
The EIA stated it sees spot Brent averaging $84.15/bbl in 2024, down from its earlier forecast of $87.79/bbl, and WTI averaging $79.70/bbl, vs. its earlier view of $83.05, however it forecast Brent rising to $85/bbl on this 12 months’s H2, as OPEC+ extends voluntary manufacturing cuts by way of Q3.
“Though crude oil costs initially fell following the OPEC+ announcement, we count on the extension of all voluntary cuts by way of 3Q24 will trigger world oil inventories to proceed falling by way of 1Q25 and put upward stress on oil costs over that interval,” the EIA stated in its report.
In the meantime, OPEC+ stated in its monthly report that continues to forecast oil progress demand this 12 months at 2.2M bbl/day and subsequent 12 months at 1.8M bbl/day, unchanged from final month’s outlook, with non-OPEC+ provide seen rising by 1.2M bbl/day in 2024 and 1.1M bbl/day in 2025, each the identical as estimated in Could.
Entrance-month Nymex crude (CL1:COM) for July supply closed +0.2% to $77.90/bbl, and front-month August Brent crude (CO1:COM) closed +0.3% to $81.92/bbl.
ETFs: (NYSEARCA:USO), (BNO), (UCO), (SCO), (USL), (DBO), (DRIP), (GUSH), (NRGU), (USOI)
Morgan Stanley analysts stated they count on Brent crude costs will rise by ~$5/bbl this summer however warned {that a} development towards tightening provide within the subsequent three months will give method to surpluses towards year-end 2024 and into 2025.
As soon as Q3 ends, the financial institution sees seasonal tailwinds turning into seasonal headwinds, noting refined product demand tends to drop by a mean 3.9M bbl/day within the September-through-January interval, making for a troublesome atmosphere to rally.
Morgan Stanley’s pricing deck for Brent crude signifies $86/bbl in Q3, easing to $85/bbl in This autumn earlier than sliding to $81/bbl firstly of 2025 and $76 by the tip of subsequent 12 months.
With out additional motion by OPEC+, Morgan Stanley analysts imagine 2025 will see a “persistent” surplus.