In its commodities report, the Barclays Research Team offer their take on oil, with some revisions to their previous forecasts.
Key Quotes:
“Although our price outlook remained bearish at the $85/b level at which the quarter began, we believe prices have overshot.
Yet, only bullish weekly EIA data or production disruptions can stem the price decline before the OPEC meeting on 6 December in Vienna.
Thus, further weakness is likely in store, which is likely to compel an OPEC+ reaction to keep some form of its cuts in place.
Given this short-term view, for prices to average $77 as previously forecast, oil would have to rapidly trade above $80 in December, which we now think is unlikely.
We mark our 4Q Brent price forecast to $75/b, a slight $2/b revision from our prior forecast.
We keep our 2019 forecast unchanged at $72/b and continue to see risks skewed to the upside next year.”
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