A survey by Haynes Boone LLC reveals banks anticipate oil prices falling below $60 a barrel by mid-2027. Despite this prediction, Standard Chartered analysts project a continued slowdown in US oil production growth, suggesting a limited supply glut.
Last month, a survey by law firm Haynes Boone LLC revealed that banks are gearing up for oil prices to fall below $60 a barrel by the middle of President-elect Donald Trump's new term. The survey of 26 bankers showed that they expect WTI prices to drop to $58.62 a barrel by 2027, nearly $20 lower than the intraday price of $76.22 at 12.00 pm ET on Wednesday. Trump says he'll push shale producers to ramp up output, even if it means operators 'drill themselves out of business.
' However, commodity analysts at Standard Chartered have predicted that the dramatic slowdown in U.S. oil production growth that we witnessed in 2024 will continue over the next two years. According to the experts, last year witnessed a sharp slowdown in non-OPEC supply growth from 2.46 mb/d in 2023 to 0.79 mb/d in 2024, primarily caused by a reduction in U.S. total liquids growth from 1.605 mb/d in 2023 to 734 kb/d in 2024. StanChart expects this trend to continue, with U.S. liquids growth expected to clock in at just 367 kb/d in 2025 before slowing down further to 151 kb/d in 2026. Stanchart says the U.S. slowdown and a long tail of declines will keep non-OPEC supply growth well below 1 mb/d over the next couple of years despite some areas of solid growth in Brazil, Canada and Guyana. In other words, there's no inevitable supply glut coming as many traders feared in 2024. Related Energy Sector Delivered Mixed Results in 2024 Meanwhile, StanChart has reported that the oil market sentiment appears to have improved significantly over the past month, particularly among hedge funds. StanChart's proprietary crude oil money-manager positioning index has risen for three successive weeks; in the latest data it rose 15.0 w/w to a 24-week high of -2.1. StanChart's positioning index for the ICE Brent contract is now positive after climbing 17.8 w/w to a 30-week high of 6.0. The improvement in sentiment has accompanied a gradual trend in higher oil price
OIL PRICES US PRODUCTION SUPPLY DEMAND TRUMP POLICY ENERGY MARKET SENTIMENT
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