Latest news with #BrentOil
Argaam
04-07-2025
- Business
- Argaam
Barclays raises Brent forecast to $72/brl for 2025
Barclays on Thursday said it raised its Brent oil price forecast by $6 to $72 per barrel for 2025 and by $10 to $70 a barrel for 2026 on an improved outlook for demand, Reuters reported. "Geopolitical tensions have eased as the US.-mediated ceasefire between Israel and Iran continues to hold and the risk premium has evaporated, but price action has been reflecting better-than-expected fundamentals, in our view," said Barclays in a note. Despite the rapid increase in output from the OPEC+ alliance, global crude oil inventories declined in the second quarter. The bank also raised its forecast for global oil demand growth by 260,000 barrels per day (bpd), supported by a noticeable rise in consumption among OECD countries, where demand exceeded previous estimates. Analysts expect US oil demand to grow by 130,000 bpd this year, 100,000 barrels higher than earlier projections, despite expectations of a gradual slowdown in economic activity later in the year.
Yahoo
04-07-2025
- Business
- Yahoo
How Traders Capitalized on Oil's Extreme Price Swings
The oil market didn't disappoint rollercoaster-ride fans in the first half of the year with wild price swings and sudden dips and price hikes. U.S. trade policies, OPEC+ production policies, and the on-and-off war premium have all influenced market movements and traders' behavior and strategies at some point over the past six oil prices traded in a fairly narrow range in the first quarter of the year, in the low to mid $70s per barrel. Hedge funds and other portfolio managers expected a recovery in China's industrial activity and oil consumption amid continued OPEC+ production cuts. Traders bet on stronger global oil demand amid restricted supply, while the Fed signaled inflation is tamed and additional interest rate cuts would follow soon. However, the price of oil collapsed at the start of the second quarter. U.S. President Donald Trump announced sweeping tariffs on all countries, threatened a trade war with Canada, America's top trading partner, and intensified trade pressures on China. The so-called 'retaliatory' tariffs on dozens of countries—now suspended—plunged the equity and oil markets into chaos. Speculators began to fear recessions, including in the United States. Investment banks elevated the risk of a U.S. recession to a base-case scenario. Traders bet on falling oil prices, amassing short positions. To compound the price slump, the OPEC+ group began in April what analysts believe is a strategy to regain market share and punish U.S. shale. The alliance led by Saudi Arabia has been consistently raising collective output by 411,000 barrels per day (bpd) each month, nearly triple the volume originally scheduled. OPEC+ continues to cite 'current healthy oil market fundamentals' to justify its production hikes. In reality, the group has been adding lower volumes than the baseline figure of 411,000 bpd, as some producers appear to now sincerely work to compensate for previous overproduction. Such is the case of Iraq, OPEC's second-biggest producer after Saudi Arabia. But non-OPEC Kazakhstan has been openly defying the group's targets as it continues to raise production from projects involving international majors such as Chevron. Kazakhstan's Energy Minister Yerlan Akkenzhenov confirmed in May that 'the republic has no right to enforce production cuts' on foreign operators. Despite Kazakhstan's production growth, the OPEC+ producers are adding fewer barrels to the market than the headline figure of 411,000 bpd. Compliance and compensation levels have been and will be key for traders and investors to guesstimate how much additional crude OPEC+ is really adding each month. For now, it looks like OPEC+ is going after market share and depressing prices for the U.S. shale producers. In the latest Dallas Fed Energy Survey out this week, 61% of executives expect their firms' oil production would decrease slightly from June 2025 to June 2026 if the WTI price remained at $60 per barrel. At WTI price at $50 per barrel, 46% of executives expect their firms' oil production would decrease significantly from June 2025 to June the slump in April and May, oil prices jumped in June to a four-month high at the beginning of the 12-day war between Israel and Iran. Traders feared a disruption to oil and gas supply from the Middle East, and were speculating that the mother of all disruptions – an Iranian attempt to close the Strait of Hormuz – shouldn't be too easily discarded. With the start of the conflict, traders hiked their bullish bets on oil prices by the most since last October. At the same time, short positions – bearish bets that prices would drop – hit the lowest level in four months. The price spike was short-lived as the U.S. ended the conflict (for now) by bombing three Iranian nuclear sites. The ceasefire added volatility to the market, which saw wild swings in June and traders followed the trends. Related: Brent crude surged by more than 30% in just three weeks, peaking on June 23, before nose-diving in its biggest two-day drop since 2022, erasing most of the gains from summer demand expectations and the Middle East risk premium, Ole Hansen, Head of Commodity Strategy at Saxo Bank, said in a commentary early this week. The latest commitment of traders reporting week to June 24 saw a dramatic unwind across commodities, sparked by the sudden easing of Middle East tensions following a U.S.-brokered ceasefire, Hansen added. 'Crude oil took the biggest hit, with WTI and Brent futures tumbling 12%, while gold and silver also lost their shine as safe-haven demand faded.' Trend-following funds and managed money accounts reacted swiftly to the fading war premium, unloading 95,500 crude oil contracts and wiping out more than half of the previous three weeks' buildup. Brent saw the biggest unwinding in longs, with the net long position – the difference between bullish and bearish bets – slashed by 29%, Saxo Bank's Hansen noted. Going forward, traders will take clues from geopolitics and U.S. trade policies, the OPEC+ moves to add supply to the market, the Fed's dot plot of the pace of expected interest rate cuts, the strength (or weakness) of peak summer oil demand, and the ever-present but currently subdued war risk premium in the Middle East. By Tsvetana Paraskova for More Top Reads From this article on Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Reuters
04-07-2025
- Business
- Reuters
Barclays raises Brent forecast to $72 per barrel for 2025
July 3 (Reuters) - Barclays on Thursday said it raised its Brent oil price forecast by $6 to $72 per barrel for 2025 and by $10 to $70 a barrel for 2026 on an improved outlook for demand. "Geopolitical tensions have eased as the U.S.-mediated ceasefire between Israel and Iran continues to hold and the risk premium has evaporated, but price action has been reflecting better-than-expected fundamentals, in our view," said Barclays in a note. Despite an accelerated increase in output from the Organization of the Petroleum Exporting Countries and its allies including Russia (OPEC+), global crude oil inventories declined in the second quarter, Barclays said. The tighter balance outlook is driven by stronger demand growth, weaker non-OPEC supply growth, and the International Energy Agency's (IEA) upward revision of baseline demand estimates, it said. Barclays raised its outlook for global demand growth by 260,000 barrels per day, with most of that coming from Organisation for Economic Co-operation and Development (OECD) countries, where it said "demand has been coming in stronger than expected". It now sees U.S. oil demand growing by 130,000 bpd this year, which is 100,000 bpd ahead of its previous estimate following a weather-related demand boost earlier in the year, although it still expects a gradual slowdown in activity. On the supply side, while OPEC+ will likely continue to phase out its voluntary production cuts at an accelerated pace, the actual output increase likely will continue to lag, Barclays said, pointing to pressure on some OPEC+ producers to curb output to compensate for earlier producing above their quotas. "Between March and May 2025, OPEC+ target increased by 548 kb/d but the group's output remained largely flat, resulting in better compliance, in aggregate," it said.
Yahoo
03-07-2025
- Business
- Yahoo
Barclays raises Brent forecast to $72 per barrel for 2025
(Reuters) -Barclays on Thursday said it raised its Brent oil price forecast by $6 to $72 per barrel for 2025 and by $10 to $70 a barrel for 2026 on an improved outlook for demand. "Geopolitical tensions have eased as the U.S.-mediated ceasefire between Israel and Iran continues to hold and the risk premium has evaporated, but price action has been reflecting better-than-expected fundamentals, in our view," said Barclays in a note. Despite an accelerated increase in output from the Organization of the Petroleum Exporting Countries and its allies including Russia (OPEC+), global crude oil inventories declined in the second quarter, Barclays said. The tighter balance outlook is driven by stronger demand growth, weaker non-OPEC supply growth, and the International Energy Agency's (IEA) upward revision of baseline demand estimates, it said. Barclays raised its outlook for global demand growth by 260,000 barrels per day, with most of that coming from Organisation for Economic Co-operation and Development (OECD) countries, where it said "demand has been coming in stronger than expected". It now sees U.S. oil demand growing by 130,000 bpd this year, which is 100,000 bpd ahead of its previous estimate following a weather-related demand boost earlier in the year, although it still expects a gradual slowdown in activity. On the supply side, while OPEC+ will likely continue to phase out its voluntary production cuts at an accelerated pace, the actual output increase likely will continue to lag, Barclays said, pointing to pressure on some OPEC+ producers to curb output to compensate for earlier producing above their quotas. "Between March and May 2025, OPEC+ target increased by 548 kb/d but the group's output remained largely flat, resulting in better compliance, in aggregate," it said.
Time of India
19-06-2025
- Business
- Time of India
icra: 4 reasons why crude oil is not likely to sustain $80/bbl. How is India impacted?
Here are 4 reasons why Brent may sustain $80 per bbl: 1) Iran's Strait of Hormuz gamble too costly to close ADVERTISEMENT 2) OPEC production 3) US Shale factor ADVERTISEMENT 4) Global oil demand growth projections ADVERTISEMENT Impact on India While the Israel-Iran tension has kept crude oil on the boil with an 8% jump in the past eight days and 23% over a month, the black gold is unlikely to breach the $80 per barrel mark, according to estimates by a couple of brokerages."While the Iran–Israel conflict is serious and merits close monitoring, we reckon Brent Oil price is unlikely to sustain above US$80/bbl in a durable way unless the Strait of Hormuz is closed, or critical Gulf infrastructure is targeted," Yes Securities said in a note. ICRA too expects crude prices to average between $70-80/bbl for persistent geopolitical tensions and repeated threats, ranging from the Iran–Iraq War to post-Iran Nuclear deal fallout, Iran has never acted on its threat to close the Strait of Securities calls this restraint strategic and economic. The Strait handles nearly 20% of global oil consumption and is vital for Qatar's LNG exports, Iran's own trade, and the energy trade of regional allies like Iraq. A full closure would not only trigger military retaliation, particularly from the US, but also damage Iran's economic interests and international standing, this brokerage has wielded the threat of disruption as a geopolitical bargaining tool, without crossing the line into direct confrontation, Yes OPEC holding spare capacity of 4mbpd—well above Iran's 1.5mbpd exports—and a projected global market surplus of 0.9mbpd before the Israel-Iran flare-up, there is ample supply believes that even if Iranian supplies of 1.5mbpd are taken out, OPEC's spare production capacity of 4mbpd is good enough to compensate for the 2008, the rise of US shale has added millions of barrels per day to global supply, increasing flexibility and price elasticity. This has allowed the market to absorb geopolitical shocks more effectively, with tensions involving Iran, Libya, or Venezuela causing only short-lived price spikes."OPEC's diminished market share and increased spare capacity, especially from Saudi Arabia and the UAE, have further capped volatility, making oil prices more range-bound and positioning US shale as a soft ceiling on prices," Yes Securities which is the second largest consumer of oil, has seen a subdued demand post-COVID due to economic rebalancing and a weak real estate sector, Yes Securities said. Long-term energy transition trends such as the rise of electric vehicles, improved fuel efficiency, and supportive green energy transition policies are further restraining demand growth in OECD countries."This softened outlook is mirrored in recent agency forecasts. The International Energy Agency now expects global oil demand to grow by about 0.72mbpd in 2025, down from the earlier estimate of 1mbpd. EIA now projects global oil consumption to rise by 0.8mbpd in 2025, down from the earlier projection of 1mbpd," Yes to ICRA, crude oil imports from Iraq, Saudi Arabia, Kuwait and the UAE that pass through the Strait of Hormuz (SoH) account for 45-50% of total crude imports by India. Moreover, about 60% of the natural gas imports by India pass through the SoH.A $10/bbl increase in the average price of crude oil for the fiscal year will typically push up net oil imports by $13-14 billion during the these elevated crude oil prices, while the profitability of upstream players will remain healthy and their capex plans will remain intact, the marketing margins of downstream players will be impacted, along with the expansion of LPG under-recoveries.
