Crude oil will likely be in a surplus next year with Brent crude prices dropping to the mid-to-high 70s range, analysts at Morgan Stanley (NYSE:MS) believe.
In a note, the bank’s analysts wrote that tightness would hold for most of the third quarter, continuing for forecast Brent crude prices of $86 per barrel.
Brent crude traded at about $80 per barrel on Monday.
The analysts see “equilibrium” returning in 4Q “when seasonal demand tailwinds abate and both OPEC and non-OPEC supply return to growth.”
They expect OPEC and non-OPEC supply to grow by about 2.5 million barrels per day in 2025, which is ahead of demand growth.
Global refinery runs are seen hitting their 2024 peak in August and are not expected by the analysts to reach this level again until July 2025.