From OilPrice.com: Oil Markets Are Much Tighter Than Oil Prices Suggest
By Alex Kimani - Feb 11, 2024, 6:00 PM CST
According to StanChart, the global oil surplus we are currently witnessing is due to seasonal weakness in the month of January.
StanChart notes that there’s been a January inventory draw in only three years since 2004, with the first month of the year averaging a build of 1.2 million barrels per day.
StanChart has predicted that this surplus is transitory and will flip into a 1.6 mb/d deficit in February.
The Energy Information Administration (EIA) is even more bullish and has forecast a 2.3 mb/d oil supply deficit.
Read more: https://oilprice.com/Energy/Crude-Oil/Oil-Markets-Are-Much-Tighter-Than-Oil-Prices-Suggest.html
Oil Demand is Seasonal - Demand spike just weeks away
Oil Demand is Seasonal - Demand spike just weeks away
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Oil Demand is Seasonal - Demand spike just weeks away
JP Morgan: Crude oil to rise another $10 by May
There’s more good news for the oil bulls. A growing number of analysts are saying oil prices have limited downside at this juncture and have forecast an oil price rally as the months roll on. According to J.P. Morgan, the oil market outlook "continues to project a tightening market with prices rising from here by another $10 by May." The JPM forecast assumes that OPEC+ leaders will unwind 400K bbl/day of cuts from April and has assigned no risk premium from the Middle East turmoil.
JPM says whereas OPEC's implementation has been "ambiguous" in the first month of new cuts, crude shipments on a 30-day moving average basis are down 1.3M bbl/day from the October peak. Meanwhile, current data suggest an improving global economy, with observable crude inventories having steadily drawn down over the last month in pivotal markets in the U.S., Europe, Japan, China and Singapore. Meanwhile, data at the beginning of the current week showed larger than expected drawdowns in gasoline and distillate inventories, further supporting the bullish thesis.
There’s more good news for the oil bulls. A growing number of analysts are saying oil prices have limited downside at this juncture and have forecast an oil price rally as the months roll on. According to J.P. Morgan, the oil market outlook "continues to project a tightening market with prices rising from here by another $10 by May." The JPM forecast assumes that OPEC+ leaders will unwind 400K bbl/day of cuts from April and has assigned no risk premium from the Middle East turmoil.
JPM says whereas OPEC's implementation has been "ambiguous" in the first month of new cuts, crude shipments on a 30-day moving average basis are down 1.3M bbl/day from the October peak. Meanwhile, current data suggest an improving global economy, with observable crude inventories having steadily drawn down over the last month in pivotal markets in the U.S., Europe, Japan, China and Singapore. Meanwhile, data at the beginning of the current week showed larger than expected drawdowns in gasoline and distillate inventories, further supporting the bullish thesis.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group