In its latest client report, Morgan Stanley raised its year-end Brent oil-price forecast, in anticipation of faster rebalancing in the oil market.
Key quotes
“We expect demand to rebound to about 97 million barrels per day (bpd) by Q4 as economies come out of lockdown – a significant improvement although still down about 4 million bpd year-on-year.”
“Now that the rebalancing has been set in motion, we expect it to continue. Our base case forecasts call for a further tightening of the oil market over the next few quarters.”
“The recent rebalancing was mostly supply rather than demand-driven with the rise in crude prices compressing refining margins even further and inventories of oil products rising fast relative to crude oil stocks.”
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