Citigroup analysts think oil may never return to $100 levels and forecasts for triple-digit crude have far more fantasy than reality at their heart, according to Bloomberg.
Key quotes
Oil product demand growth will falter significantly, change its contours, and never return to pre-coronavirus rates of growth.
With production returning at $45 a barrel, longer-term supply costs falling in recent years, and plenty of supply already offline with political risks, triple-digit crude looks unlikely.
oil is more likely to be at $45 than $60 a barrel in the long-term.
West Texas Intermediate (WTI) crude, North America’s oil benchmark, is trading at $39.80 per barrel at press time, representing a 300% gain on the single-digit price observed in April.
The recovery rally could be attributed to the OPEC+ output cut deal, liquidity-driven risk-on rally in the financial markets and optimism stemming from the gradual re-opening of the global economy.
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