Macro oils short-term outlook: August 2023 Report

Commodity Market Report 07 August 2023

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Report summary

Brent recovered during July, averaging $80.10/bbl, slightly higher than our July forecast of $77.00/bbl. Our forecast for a tighter outlook in H2 2023 is increasingly reflected in the price. Extra support has been provided by Saudi Arabia announcing on 3 August that it will extend its current 1 million b/d production cut for July and August into September. Russia followed up that it would continue with its additional cut in September also. Key highlights this month focus on: • Outlook for oil demand remains steady despite weakening global manufacturing • Saudi Arabia and Russia’s additional voluntary cuts for September • Libya presents a key downside supply risk; potential for 90% of oil production to be shut-in • Outlook for price in tighter H2 2023

Outlook for 2024 and 2025
Global Supply: Saudi Arabia to extend 1 million b/d additional voluntary cut to September
- Non-OPEC supply: downward revisions dominated by US Lower 48 oil
- OPEC supply : Saudi Arabia to extend voluntary cut of 1 million b/d to September
Global demand: Outlook remains steady despite weakening global manufacturing
- Liquids demand by key markets
- Global outlook for 2024
- Global outlook for 2025
- Risks to the outlook