Brent oil price likely anchored around $80 / bbl says Morgan Stanley

<p>Oil could be anchored near $80 a barrel according to a Morgan Stanley note from late last week. </p><p>The main points made are that:</p><ul><li>a more balanced oil market could be close by</li><li>oil market is likely to remain in a deficit in the second of half of 2023 before returning to a small surplus next year. <ul><li>“We still see undersupply – and hence inventory draws – for the remainder of 3Q as well as 4Q. However, this turns into small builds in the early part of next year” </li></ul></li><li>“We suspect that the likely inventory trajectory anchors the market around $80/bbl, probably in a $75-85/bbl range”<ul><li>raised its Brent price forecast for the third quarter to $85 per barrel from $75, and for the fourth quarter to $82.50 from $70.</li></ul></li></ul><p>“Strong refined products markets and deep OPEC cuts have been supporting crude oil prices”. Counterveiling factors MS point out include:</p><ul><li>OPEC’s production cuts will have a bullish impact on oil prices in the near future</li><li>spare capacity is at its highest in 20 years and a decline in the group’s market share could weigh on prices in the longer term</li></ul><p>Morgan Stanley raised its 2023 oil demand forecast to 2.1 mn barrels per day from 1.8 mn.</p>

This article was written by Eamonn Sheridan at www.forexlive.com.