Introduction

 

Will the world see $60 oil again? The current outlook for oil is grim, with world inventories well above their 5-year average, and product demand well below pre-pandemic levels. Yet, if world oil demand recovers the way the International Energy Agency (IEA) envisions, we anticipates that prices could return to $60 before year-end 2021. However, oil prices can rise, a number of conditions need to be satisfied, including lower inventory levels and a reduction in OPEC’s spare production capacity.

This report aggregates research and analysis from BloombergNEF and the Bloomberg Terminal to anticipate world oil market trends and outline the necessary conditions for oil recovery.

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Contents

1. After the price shock: What oil needs to rebound
    
2. Modeling near-term crude oil prices with inventory and OPEC spare capacity
    

3. Oil-product inventory suggests recovery could be a lengthy wait