- Oil is relatively unchanged amid persistent demand concerns
- August ’23 WTI gained 16c this morning to trade around $67.87/Bbl
- Equities trade higher, and the dollar strengthened, making commodities priced in USD expensive for holders of other currencies
- Rising interest rates and moderate demand from China, the top oil importer, have weighed on oil prices which are at a near two-week low amid recession fears
- Many analysts forecast a tighter market in 2H 2023 due to continuing OPEC+ supply cuts and Saudi Arabia's voluntary July reduction
- Imminent Oil Market Deficit Expected, Says Standard Chartered (Bloomberg)
- Standard Chartered forecasts Q3 2023 shift towards oil deficits, pushing prices beyond $74-$76/Bbl
- Deficits of 1.33 MMBbl/d in July and 1.7 MMBbl/d in August, after an April surplus of 1.41 MMBbl/d, indicate high price risk, according to a note to clients on June 27
- The bank forecasted Brent to reach $88/Bbl in Q3 and $93/Bbl in Q4
- Currently, money managers are overly bearish in crude, despite significant upside price risk and relative lack of downside potential, said analysts Emily Ashford and Paul Horsnell