- Brent is trading c. $85/bbl, up $3/bbl m-o-m, with prices volatile above $80/bbl as the market tries to make sense of an array of supply and demand risks
- We see global demand growth of 1.77 million b/d in 2023 (+240,000 b/d on previous), with the OECD subdued by inflation as US demand appears to wane slightly in the latest data
- China’s reopening once again drives demand growth, but the size and speed still remains uncertain, as does OECD interest rate policy
- We forecast global production growth of 1.44 million b/d in 2023 (+240,000 b/d on previous) with the US the main contributor
- Brazil, Norway, Canada, Guyana and China all grow, but are balanced by Russia’s estimated 900,000 b/d loss to sanctions and price caps
- The threshold for a Saudi response to a price spike appears high after comments by the energy minister, likely requiring intervention from all major consuming nations, i.e., China, the US, the EU
- We provisionally see inventories drawing 150,000 b/d on average in 2023 (60,000 b/d larger than previous), but Russian and OPEC+ supply, OECD and Chinese demand are all uncertain
by Graham Walker // 3 March, 2023
← Back to Blog