Rising sharply after the March OPEC+ meeting's surprise result, Brent is now trading c. $63/bbl, having flirted with $60/bbl on fresh European lockdowns before the EverGiven got stuck in the Suez Canal- Despite this, we increase our Brent annual average forecast to $60.01/bbl in 2021 (+$3.05/bbl on previous), due to the initially firmer prices post-meeting and a likely slower OPEC+ unwind
- Our 2021 demand growth forecast rises slightly to +5.88 million b/d (+50,000 b/d on previous), on the expectation that restrictions in the OECD give way to economic recovery from 2Q20
- In the immediate future, further restrictions slow the demand recovery in Europe, while delays to the vaccine rollout there may exacerbate the situation
- After surprising the market by holding most quotas unchanged last month, we expect a similar result in OPEC+'s April 1st meeting
- This would continue a trend of Russia getting the best of it at the negotiating table, as it continues to gain market share while extra Saudi cuts support prices
- IEA projections see oil demand growing steadily through to 2026, though by ever smaller amoun...
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by Graham Walker // 29 March, 2021
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