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Week Mar 09 - Mar 13, 2020 |
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ISec Report: Oil to plunge as market share war to boost supply
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Global
oil supply is set to rise by over 3.9m b/d in Apr'20 given the
output increase announced by Saudi Arabia, UAE and Russia. Russia
opposing OPEC deal to cut OPEC+ output by a further 1.5m b/d has
triggered this market share war. A surge in supply, when global
demand is down or flat, may lead to a plunge in WTI and Brent to
US$20-25/bbl. Ball is now in Russia's court with oil price well
below US$42.4/bbl (likely to fall further), which it had indicated
it was fine with. We see two possible scenarios - 1) output cut by
OPEC+ leads to oil price recovery or 2) after plunge oil gradually
recovers as US output starts declining .| Disclaimer : We expressly clarify that this communication is neither a solicitation nor an invitation of any sort whatsoever from ICICI Securities Ltd. or any of its subsidiaries to create a client relationship. This communication is not intended to be a source of advertising or any specific advice; the recipient should always seek the advice of competent counsel licensed to practice in the recipient's country/state. In case this mail doesn't concern you, please Unsubscribe from Market Wrap mailing list. |