Oil Market Snapshot – April 2022

  • Brent ends April trading at c. $109/bbl after another turbulent month
  • We forecast global demand growth of 2.64 million b/d for 2022 (-300,000 b/d on previous)
  • This follows a major downgrade to global economic growth from the IMF, on the basis of Russia's invasion of Ukraine and persistent lockdowns in China
  • Ongoing inflation and supply chain issues combine with the direct effect of the war on the economies of Russia, Ukraine, and Europe more widely
  • We forecast global supply growth of 3.97 million b/d in 2022 (-71,000 b/d on previous), as Russia's production losses become more concrete
  • With the OPEC+ deal ending in September, the group will maintain its schedule until then barring a desperate market shortage
  • A coordinated stock release between the US and other IEA members should add 1.3 million b/d over six months, but Russian losses may reach as high as 3 million b/d month to month
  • Averaged over the whole year, the country will lose at least 1 million b/d of crude, and likely more
  • We see a deficit of 860,000 b/d in 2022 (410,000 b/d larger than previous) as Russia's productio...

    Please log in to view
    the rest of this report.


    Not yet a subscriber?
    Contact us today!

    If you do not yet have an account with us and would like to register or find out more, please contact us using our client services form, send an email to admin@petrologica.com or call us on +44(0)1206 823 295.

Oil Market Snapshot – March 2022

  • Brent is trading around $114/bbl at the end of the most volatile month in the contract's history. The last thirty days have seen prices as high as $139/bbl and below $100/bbl
  • The extreme volatility sees us suspend our price forecast. The EIA forecasts an average price of $105.05/bbl for 2022 (+$22.09/bbl on previous)
  • We forecast global demand growth of 2.94 million b/d for 2022 (-610,000 b/d on previous), lowered as a result of lockdowns in China and the prospect economic turmoil from the war
  • This leaves global annual average demand below 2019's level for a third year, with inflation still a downside risk as OECD nations indiscriminately cut fuel taxes, supporting demand
  • We forecast global supply growth of 4.68 million b/d in 2022 (-1.13 million b/d on previous), with around half the change due to lost Russian production
  • Though sanctions will not end if the war does, self-sanctioning may be reduced from its current levels
  • The meeting of March 31st is again likely to see no change to the OPEC+ schedule, with the key Gulf members stating their support for keeping Russia in the group
  • So far...

    Please log in to view
    the rest of this report.


    Not yet a subscriber?
    Contact us today!

    If you do not yet have an account with us and would like to register or find out more, please contact us using our client services form, send an email to admin@petrologica.com or call us on +44(0)1206 823 295.

Oil Market Snapshot – February 2022

  • Russia's invasion of Ukraine sent Brent to $105/bbl. It trades now at c. $103/bbl after the imposition of sanctions, with the prospect of high prices for the foreseeable future
  • We forecast global demand growth of 3.55 million b/d for 2022 (-150,000 b/d on previous), with demand finally exceeding 2019's level
  • Inflation remains a downside risk, running above 7% in the US currently, while China's zero tolerance policy on COVID has also impacted its growth
  • We forecast global supply growth of 5.81 million b/d in 2022(-40,000 b/d on previous), based on OPEC+ sticking to its scheduled unwind of its cuts deal
  • The meeting of March 2nd is likely to see the group maintain its schedule, with the Ukraine situation only potentially impacting policy if Russian production is materially affected
  • In such a case, Saudi Arabia's instinct to stabilise the market by covering lost production would have to be tempered by avoiding being seen to take Russia's market share
  • Major oil companies have booked high free cash flow, with capex remaining low and prices high. But much of the windfall is being returned to shareholders

    Please log in to view
    the rest of this report.


    Not yet a subscriber?
    Contact us today!

    If you do not yet have an account with us and would like to register or find out more, please contact us using our client services form, send an email to admin@petrologica.com or call us on +44(0)1206 823 295.