July 12, 2024

Global Commodities: A dichotomy in the oil balance

11 minutes

Speakers:

Natasha Kaneva, Head of Global Commodities Research

Our balances suggest a ~1.0 mbd deficit in oil liquids in 3Q, comprised of a large 1.6 mbd surplus in products, but a massive 2.4 mbd draw in crude. This dichotomy represents a historic norm in terms of direction, but is an anomaly in terms of scale. Supply and demand so far have performed largely in line with our expectations, but if there is a weak spot in our balances, it would likely be on the refining side. Throughout this year we have been consistently downgrading our projections for growth in global processing rates for 2024, and now see only 1 mbd growth this year vs 1.8 mbd originally. We maintain our long-held view that Brent oil will reach $90 by September, average $84 in the third quarter and $83 for the year, before dropping into mid-$60s in 4Q25.

This podcast was recorded on 12 July 2024.

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