Macquarie analysts acknowledge the possibility of a summer rally, but warn the market may not be affected by a nut on Friday.
They maintain a structurally bearish stance on crude oil prices despite potential near-term upward pressure.
“[A] summer rally [is] possible, but [the] The market can look past it and the draws can disappoint,” says Macquarie. The company highlights concerns about surpluses in the second half of 2024 and throughout 2025, which could lead to a significant price correction.
While Macquarie acknowledges the geopolitical risks and the potential for a hot summer to drive demand, he identifies several negative factors. They express concerns about OPEC+’s compliance with production quotas, especially in the context of US election year dynamics. In addition, they foresee continued growth in oil production from non-OPEC countries, including from the United States, which may depress prices.
Macquarie is also tempering enthusiasm for potential production increases from new sources such as the Dangote refinery and Dos Bocas facilities, suggesting their ramp-up could be slower than expected. Finally, the report suggests that Chinese oil demand, especially diesel, is becoming less sensitive to economic growth, further limiting upside potential.
Overall, Macquarie’s analysis suggests a cautious approach to the possibility of an oil rally in the summer. They believe that structural factors could lead to a price correction, despite possible short-term upward pressure.
