- Brent continues its decline to two-year low of c. $97/bbl
- ICE Brent Futures contango deepened, as front month contract price fell faster than longer-term contracts
- We have again slashed our oil price forecast for 2014. For 2015 we expect a slightly higher average Brent price. The revision is prompted by a shift in the futures market and a stronger US Dollar
- Downward revisions of global GDP growth by the IMF induce a contraction in our oil demand forecast to 0.95 million b/d for 2014 (previously 0.97 million b/d) and 1.26 million b/d for 2015 (1.31 million b/d)
- Wage stagnation and tightening credit supplies in the OECD suggest unbalanced economic growth
- Excess oil supply driven by US light tight oil, weighs on short term oil prices partly offset by increasing conflict in the Middle-East and a Saudi Arabian production cut
- Longer term we see strong fundamentals with a tight oil market as investment in capacity slows
by Graham Walker // 26 September, 2014
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