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5 May 2015
WTI seen at $57 year-end – BAML
FXStreet (Edinburgh) - Analyst at BAML Sabine Schels expects the barrel of WTI to trade around the $57.00/bbl mark towards year-end.
Key Quotes
“The run-up in prices in our view conceals a weak underlying fundamental balance”.
“Initially, the oil market surplus was reflected in large increases in crude inventories, placing downward pressure on crude oil prices, time spreads and differentials”.
“Now we are about to see petroleum products building as refineries ramp up after maintenance”.
“However, the market seems to have found a spot crude price low, and we recently lifted our end-of-quarter WTI target for 2Q15 from $41 to $59/bbl”.
“Even then, we see WTI prices double dipping to $50/bbl as refinery maintenance kicks in again in September before recovering to $57/bbl by year end”.
“We also raised our Brent end-of-quarter 2Q forecasts to $63/bbl, but lowered 3Q to $54/bbl and left 4Q unchanged at $61/bbl”.
Key Quotes
“The run-up in prices in our view conceals a weak underlying fundamental balance”.
“Initially, the oil market surplus was reflected in large increases in crude inventories, placing downward pressure on crude oil prices, time spreads and differentials”.
“Now we are about to see petroleum products building as refineries ramp up after maintenance”.
“However, the market seems to have found a spot crude price low, and we recently lifted our end-of-quarter WTI target for 2Q15 from $41 to $59/bbl”.
“Even then, we see WTI prices double dipping to $50/bbl as refinery maintenance kicks in again in September before recovering to $57/bbl by year end”.
“We also raised our Brent end-of-quarter 2Q forecasts to $63/bbl, but lowered 3Q to $54/bbl and left 4Q unchanged at $61/bbl”.