Oil market prone to be in surplus one year from now, Morgan Stanley says

The raw petroleum market is at present close however one year from now will probably be in excess, with Brent costs declining into the mid-to-high $70s territory, Morgan Stanley said.

The snugness will hold for the greater part of the second from last quarter, the bank said in a note dated on Friday, however balance will return by the final quarter, “when occasional interest tailwinds lessen and both OPEC and non-OPEC supply return to development.”

Three sources told Reuters last week that OPEC+ is probably not going to suggest changing the gathering’s result strategy at a scaled down clerical gathering one month from now, passing on set up an arrangement to begin loosening up one layer of oil yield cuts from October.

Morgan Stanley said it anticipates OPEC and non-OPEC supply to develop by around 2.5 million barrels each day (bpd) in 2025, well in front of interest development.

Treatment facility runs are set to arrive at a top in August this year, and far-fetched to get back to that level until July 2025, it said.

Morgan Stanley left its estimate at Brent rough costs for the second from last quarter of 2024 unaltered at $86 per barrel. Recently, Goldman Sachs likewise kept up with its projection for the quarter at a typical Brent cost of $86 a barrel.

Brent rough costs on Monday were up 0.54% at $83.08 a barrel by 0535 GMT, and U.S. West Texas Middle unrefined fates were up 0.54% at $80.56. [O/R]