Macquarie analysts admit the possibility of a summer rally but warn the market may not be swayed by Friday’s report.
They remain structurally bearish on crude oil prices despite potential near-term upward pressure.
“[A] summer rally [is] maybe, but [the] The market may look past him and draws may disappoint,” states Macquarie. The firm highlights concerns about surpluses in the second half of 2024 and throughout 2025, which could lead to a significant price correction.
While acknowledging geopolitical risks and the potential for increased demand during hot summers, Macquarie highlights several negative factors. They express concerns about OPEC+ compliance with production quotas, especially in the context of US election year dynamics. In addition, they forecast continued growth in oil production in non-OPEC countries, including the United States, which could lead to lower prices.
Macquarie is also tempering enthusiasm for potential production increases from new sources such as the Dangote refinery and Dos Bocas refineries, suggesting their ramp-up may be slower than expected. Finally, the report says China’s oil demand, especially diesel, is becoming less sensitive to economic growth, further limiting growth potential.
Overall, Macquarie’s analysis suggests a cautious approach to the possibility of a summer oil rally. They believe structural factors could lead to a price correction despite potential short-term upward pressure.