Morgan Stanley forecasts a surplus of oil on the market from the fall

22.07.2024. / 16:24

NEW YORK – The crude oil market is currently tight, but next year is likely to be in excess supply, with Brent prices falling into the mid-to-high $70s, Morgan Stanley said.

The tightness will remain for most of the third quarter, but balance will return by the fourth quarter, “when the seasonal tailwinds for demand weaken” and supply from OPEC+ countries and others starts to rise again, the bank said in a note, according to Reuters. .

Multiple sources told the British agency last Sunday that OPEC+ was unlikely to recommend a change in the group’s output policy at a ministerial meeting next month, leaving in place a plan to begin lifting part of the oil output cuts from October.

Morgan Stanley said it expects supply from OPEC and other oil-producing nations to grow by about 2.5 million barrels per day in 2025, well ahead of demand growth.

Refineries will reach their peak in August this year, and it is unlikely that they will return to that level before July 2025, according to the bank’s note.

Morgan Stanley left its forecast for Brent oil prices for the third quarter of this year unchanged at $86 per barrel.

Earlier this month, Goldman Sachs also kept its projection for the quarter at an average Brent price of $86 per barrel.

Brent oil traded at a price of around $82.50 per barrel on Monday at noon. Biznis.rs