Macro oils short-term outlook: January 2022 Report

Commodity Market Report 11 January 2022

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Report summary

In an uncertain market, we are making startling few changes to our forecast. Our demand view took into account the persistence of Covid and intermittent lockdowns, minimising the impact of Omricon on our forecast for 2022. The OPEC+ meeting stuck to its planned increase which was our base case. However, geopolitical uncertainty is escalating and Covid remains a critical risk to the global economy, oil demand and the oil market. This Macro Oils short-term outlook highlights include: • Lower 48: DUC inventories draw closer to an end • OPEC+ rollover continues, despite lower prices • Travel restriction analysis in the wake of the Omicron variant • Details on the global release of strategic petroleum reserves

Global supply: political unrest and protests add to supply risk
- Non-OPEC: upward revision to US Lower 48 offsets downgrades to Norway, Brazil and Russia
- US Lower 48: improving efficiencies push growth higher
- OPEC: Libya outages; easing of production restraint continues as planned for OPEC+
Global demand: Risks to growth are to the downside as 2022 begins
- As recovery continues, oil demand risks are to the downside