This May edition of Glenloch Energy's Oil Market Forecast ("OMF") sees OPEC+ steadily return production to market as COVID 19 cases surge in India.
Meanwhile, cases in the USA and UK continue to decline to the point where mask mandates and travel restrictions are being lifted.
All major forecasting institutions continue to predict a strong second half recovery in oil demand.
The key point in this edition:
- The oil market is expected to remain in deficit through the rest of the year, as OPEC+ relax their supply curbs and demand recovers.
- Demand growth forecasts have been consistently robust for the second half of the year, despite uncertainties surrounding the trajectory of recovery from COVID 19.
- A sudden return of Iranian crude to market is the most likely event to upset the supply and demand balance.
- We expect global crude storage to fall back to its long term average by the end of the year.
- Brent and WTI spot prices continue to rise with Brent briefly touching $70/barrel earlier this month.
- Both Brent and WTI futures continue to rise.
- US rig count continues to grow but shows no sign of acceleration.
- We predict US Production will fall again this year.
Access Glenloch Energy's May OMF here.