(Bloomberg) –Add Morgan Stanley to the list of banks expecting crude to reach $100 a barrel later this year.
The bank expects stockpiles to slide even lower by the end of the year, after falling substantially in 2021, according to a research note to clients. Spare supply capacity will shrink to 2 million barrels a day from the current 3.4 million. Investment to boost supply capacity in the oil industry is expected to shrivel 30% by the end of this decade as green initiatives progress.
Previously, the bank saw demand erosion starting once the global benchmark neared $90 a barrel. Now, it sees attrition happening at a higher level, because consumption in oil products has been resilient, the analysts, including Martijn Rats said in the note. For instance, jet demand is projected to grow 1.5 million barrels a day by this summer, while Google Mobility data reflects a sharp increase from the year prior.
Earlier this week, Goldman Sachs, one of the world’s top investment banks, said it saw Brent prices reaching $100 also in the third quarter because of a large supply deficit.
Source: www.worldoil.com
Author: World Oil