Oil Market Snapshot – December 2020 Brent Firm at $50/bbl Despite New COVID Strain in UK

Brent has held above $50/bbl, up more than $7/bbl against November's average, as markets anticipate mass vaccinations despite a worsening global COVID-19 caseload
We see Brent averaging $41.59/bbl in 2020 and $50.38/bbl in 2021 (+0.36/bbl and +2.11/bbl, respectively), reflecting improved demand and market sentiment following commencement of vaccinations
Our global demand growth forecast for 2020 is revised to -8.93 million b/d (+130,000 b/d on previous) as current lockdown measures appear less stringent compared to those in 2Q20
Next year's demand is highly dependent on how life changes once vaccines are widely available
Our global supply growth forecast for 2020 decreases to -6.68 million b/d in 2020 (-70,000 b/d on previous) as Brazil's Petrobras slashes capex
After a contentious meeting, OPEC+ agreed to raise quotas by a maximum of 500,000 b/d for each month of 1Q21

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