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Morgan Stanley has raised its third-quarter price forecasts for Brent and West Texas Intermediate (WTI) oil to $30 per barrel and $27.50 per barrel from the previous forecasts of $25 and $22.50, respectively, according to Reuters. 

Key quote

The OPEC+ deal will not prevent sharp inventory builds in the coming months but would lead to stock reductions from the second half of 2020 onwards.

Demand is projected to fall about 14 million barrels per day year-on-year in the second quarter.

OPEC+, an organization of 24 producers led by Saudi Arabia and Russia, recently agreed to cut the oil output by 9.7 million barrels per day to rebalance the market and put a floor under prices. 

While some analysts expect the sell-off in oil to stall on the OPEC+ deal, there seems to be a consensus that it would fall short of compensating for the demand destruction brought on by the coronavirus outbreak. 

At press time, Brent is trading at $32.28, representing a 1% gain on the day, while a barrel of WTI is changing hands near $22.50, up 0.5% on the day.