The EU has agreed direct and secondary sanctions on Russian oil, pushing prices toward $120/bbl
We forecast global demand growth of 2.38 million b/d for 2022 (-260,000 b/d on previous), which would keep demand below 2019 levels for another year
China's lockdowns have hurt demand there, but pent-up demand may now add to a tight market in the high demand summer season
We forecast global supply growth of 3 million b/d in 2022 (-970,000 b/d on previous), with non-US non-OPEC production declining due to lost Russian production
We see Russia losing 2.8 million b/d by YE22, when the sanctions are fully in place, and few alternative sources of supply
OPEC+ has signalled continuing with the existing agreement, but there are rumours the group is considering an exemption for Russia
We consider this difficult to achieve by the meeting on 2nd June, but more plausible for later meetings
We see a deficit of 1.83 million b/d in 2022 (650,000 b/d larger than previous) leaving the market very tight and consumer countries hoping for the Iran deal to be resolved soon
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