After a spike to c. $70/bbl in the wake of the assassination of Iranian General Qassim Soleimani, Brent has collapsed to $60.15/bbl on expectations of weaker demand due to the coronavirus outbreak
A muted reaction to the first phase of the US-China trade deal and weaker growth expectations from the IMF have also added downward pressure
Our global demand growth forecasts are trimmed to 970,000 b/d (-10,000 b/d m-o-m) for 2019 and 1.22 million b/d (-200,000 b/d) for 2020
Our global supply growth forecast for 2019 is revised down to 220,000 b/d (-80,000 b/d on previous), and 1.28 million b/d in 2020 (-550,000 b/d on previous) on major OPEC outages
We see Brent averaging $65.85/bbl in 2020 and $66.64/bbl in 2021 (+$2.21 on previous, and new forecast, respectively), though there is downside risk if the outbreak is not adequately contained
OPEC laggards Iraq and Nigeria improved compliance in December, but not through choice, with the former’s civil unrest intensifying while the latter was hampered by maintenance
Libyan production may be all but wiped out as forces led by General Haftar blockade ports and fiel...
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