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Analysts at Danske Bank see the Brent to average $40/bbl during the third and fourth quarter and at $45 next year. They point out the oil market will need time to complete the rebalancing of supply and demand. 

Key Quotes: 

“Oil consumption has started to recover as economies reopen. Demand has received a further boost from a drop in USD. On top of this, OPEC+ production cuts are doing their part in the rebalancing of supply and demand. The return to more normal market conditions is a long uphill ride. Drawdown of large inventories will limit a swift recovery of e.g. US shale oil production. Even when there comes room to increase output, it remains to be seen how easy it will be to turn on wells that have been shut in. Finally, OPEC+ stands committed to output cuts for now, but as the oil price recovers, this commitment may start to falter. On a medium to long-term horizon, low investment activity now may result in supply shortages.”

“The recent rally in oil prices along with our more positive view on the outlook for world economic growth and the small extension of OPEC+ output cuts make us forecast Brent to average USD40/bbl in Q3 and Q4 2020, USD45/bbl in Q1 and Q2 next year, USD50/bbl in Q3 and USD60/bbl in Q4 next year.”