Brent has traded around $45/bbl in August, after four consecutive weekly US crude inventory draws, though stocks remain elevated
Still, global COVID-19 cases have resumed an upward trend after European lockdown measures were eased, leading to them being reimposed in some hotspots
We see Brent averaging $41.81/bbl in 2020 and $51.05/bbl in 2021 (+$2.28/bbl and -$0.29/bbl on previous, respectively)
Our global demand growth forecast for 2020 is down marginally at -7.97 million b/d (-200,000 b/d on previous), as jet fuel demand continues to lag
Recent Chinese demand has been stronger than expected, though this is partially explained by stocks of crude and products being built up to cover refinery maintenance
Our global supply growth forecast for 2020 is -6.7 million b/d in 2020 (+230,000 b/d on previous), mostly due to expectations of a smaller decline from Canada
This would leave global inventories building by 670,000 b/d in 2020 on average, leaving a large inventory overhang into 2021
OPEC expects an inventory overhang nearly double that size, even if OPEC achieves 100% compliance through year end...
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