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Citi Neutral to Slightly Bearish Oil in 2024

OIL

Oil markets are brushing off US strikes against Iranian backed militants due to regional leader comments consistent with avoidance of war according to Max Layton, Citi global head of commodities research in a CNBC interview earlier this week.

  • “Right now, I think the market is super finely balanced and just to drive home that point, if OPEC+ members met their quotas this quarter we would actually have a deficit. It’s only because of the cheating at the margin by some countries relative to their quotas.” Layton said.
  • “Looking into the second quarter and into the rest of this year, we certainly model a small surplus market.” Layton said.
  • “There are 2mn bpd of spare capacity in Russia and Saudi Arabia alone, that there wasn’t in 2019. This is overhanging the market.” Layton added.
  • Citi are neutral to slightly bearish for oil prices through the rest of 2024. See chart for Citi WTI and Brent outlooks.

Source: Citi/CNBC

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