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Faltering demand is preventing oil prices to experience a sustained increase, according to analysts at the Research Department at BBVA. They expected the price of the WTI barrel to remain under $45 for the rest of the year. 

Key Quotes: 

“In the absence of a vaccine, we expect prices to remain below $45 per barrel for the rest of the year.”

“Petroleum demand is recovering, but continues to be capped by the pandemic’s effects on economic activity.”

“OPEC+ compliance has been supportive of prices, however, output cuts are projected to slow down in the following months.”

“Although still above trend, inventories have subsided, easing pressures on storage capacity.”

“In the U.S., government intervention has helped avoid a massive wave of bankruptcies. Prospects could significantly tilt to the upside if a vaccine is available in 4Q20.”