- WTI is up 3c to $63.25/Bbl, and Brent is down 1c to $67.04/Bbl
- Barclays lifts its oil price forecast on muted supply response, improving demand outlook
- The bank sees Brent and WTI averaging $67/Bbl and $63/Bbl in 4Q2021, respectively
- Barclays did urge caution as a few downside risks threaten the market in the near term, including easing OPEC+ cuts, rising COVID-19 infections from the new strains, and elevated positioning
- OPEC+ to consider a 500 MBbl/d output increase at its March 4 meeting
- The cartel is currently withholding 7.125 MMBbl/d of output, or around 7% of world demand, despite the recent run-up in crude prices
- Saudi Arabia's voluntary cuts of 1 MMBbl/d will be up at the end of March, at which point the country will gradually return that supply to the market
- AEGIS notes, the recent run-up in crude prices has caused several trading houses to upgrade their price forecasts. With nearly 7 MMBbl/d of spare capacity on the sidelines, OPEC is still holding oil prices hostage
- U.S. crude output dropped by more than 1 MMBbl/d last week for the largest weekly fall ever (EIA)
- Refinery runs also fell to their lowest level since 2008, as the Texas freeze caused refineries to reduce inputs and shutter processing units
- Some analysts were estimating that much more supply was knocked offline due to the freeze, however, weekly production figures are largely based on estimates. Monthly data should provide a more reliable figure