Macro analysis of the global oil markets to distill the evolving risks and opportunities for energy industry stakeholders and wealth managers.
Case studies, research and analysis tailored to meet government policy as well as business needs. Specializing in market trends, commodity pricing, deregulation.
Connecting the dots between fundamentals, economics, financial markets, regulatory and policy changes, demographics, geopolitics and more.
Crude turns sideways with eye on OPEC+ and US-China thaw uncertainty - April 25, 2025
OPEC+ strains, lingering US-China trade standoff weigh on crude - April 25, 2025
We kept you on the right track on the US-China spat, noting in last Friday’s Oil Viewsletter that the markets had gotten carried away by a shaky narrative that the US and China were on the verge of starting trade negotiations.
Crude’s gains from that story, which propped Brent within sight of $68, were unlikely to stick, we said, and were proved right.
US President Trump and his Treasury Secretary Scott Bessent this week made further attempts to soothe jittery markets, signalling that they were looking at ways to break the impasse with China and begin trade talks. Trump also walked back his rhetoric against Fed Chair Jerome Powell, giving markets a breather. But Beijing refuted suggestions that talks were imminent, reiterating its demand for the US to first roll back all the tariffs as a pre-condition to any high-level engagement.
Predictably, Brent retreated from $68 this week, only to get hemmed in a narrow band of $66-67. It had skidded below the $66 handle late-Friday in Asia, as we closed the report.
Crude has also come under pressure from fresh signs of strain within OPEC+, with non-OPEC collaborator Kazakhstan asserting it would prioritise national interests over quota commitments in deciding output policy and hinting that it may have to quit the alliance. We weigh five possible outcomes of this tricky situation and their impact on crude.
Mildly bearish near-term and second-half April - April 2, 2025
After weighing the factors supporting and weighing on crude, we concluded:
US' tough new Russia oil sanctions may have a short shelf life - Jan. 12, 2025
The Biden administration took oil market players by surprise on Friday by announcing the most expansive sanctions yet against Russia’s oil sector.
We suspect it was not only the oil market; the US’ European Union allies across the pond may have also been caught unawares – we couldn’t find a single reaction from any of the region’s leaders! The UK, for what it is worth, joined the US, simultaneously announcing sanctions against Gazpromneft and Surgutneftegas,
It was curious to see Biden fire the bazooka just 10 days before handing over charge to Donald Trump, who is clearly going to have a vastly different approach to resolving the Ukraine war.
What does the upcoming change of guard in the US say for the durability of the latest round of sanctions and crude’s 4% spike on Friday? Our succinct insights in this report.
OIL IN 2025: Softer crude prices but not because of oversupply - Dec. 27, 2024
Benchmark Brent crude prices averaged just under $80/barrel in 2024, about 2.7% lower versus last year.
We expect the average to dip into the $70-75/barrel band in 2025, but not because of a sizeable oversupply in the market, let alone a “glut”.
A sombre economic outlook for 2025, bolstered by China’s uphill battle to jump-start growth and amplified by expectations of a fresh round of trade wars under Trump 2.0, has shaped a bearish narrative around oil demand.
But we would caution against leaning too much into the gloom-and-doom scenario.
Crude is more likely to come under pressure from an evaporating geopolitical risk premium and worries over economic stability than any severe economic downturns or recessions.
Oil demand could remain relatively resilient, helped by softer prices, leading to a largely balanced market, especially with OPEC+ remaining extra cautious and conservative in bringing back the barrels it has locked away.
What challenges our baseline views? We also bring you the contrarian perspective and wildcards!
Lorem Ipsum is simply dummy text of the printing and typesetting industry. Lorem Ipsum has been the industry's standard dummy text ever since the 1500s, when an unknown printer took a galley of type and scrambled it to make a type specimen book. It has survived not only five centuries, but also the leap into electronic typesetting, remaining essentially unchanged. It was popularised in the 1960s with the release of Letraset sheets containing Lorem Ipsum passages, and more recently with desktop publishing software like Aldus PageMaker including versions of Lorem Ipsum.
