Brent: Prices Set To Plumb Historic Lows

摘要

We have revised down our 2020 annual average forecast for Brent crude from USD43.0/bbl to USD30.0/bbl. In Q2, prices will face extreme physical and fnancial stress, as Covid-19 containment measures cripple demand, while Saudi Arabia foods the market with supply. Demand will begin to recover in H2, as containment measures are rolled back and economic activity normalises. However, social distancing measures will likely prove sticky and the road to recovery will be slow. Low prices will help stimulate demand in the medium term, but the strength in growth will be limited by DM demand destruction, demographic drags and a softer pace of global economic expansion.