Oil prices are surging, hitting highs not seen in three months due to supply concerns and geopolitical tensions. Sanctions on Russian exports and harsh winter weather are tightening global inventories. The discussion shifts to China's economic backdrop, where proposed stimulus measures aim to combat deflationary trends and could impact travel and commodities markets. Experts forecast prices averaging $73 this year, with a potential dip below $70 in the last quarter.
12:00
forum Ask episode
web_stories AI Snips
view_agenda Chapters
auto_awesome Transcript
info_circle Episode notes
insights INSIGHT
Oil Price Surge
Oil prices surged 10% between December 23, 2024 and January 10, 2025, reaching a three-month high of nearly $80.
This rally followed a strong end to 2024 and continued into the new year, driven by supportive market fundamentals.
insights INSIGHT
Oil Price Drivers
Several factors drove the oil price action, including supply disruption concerns, low oil stocks, and freezing temperatures.
Improved sentiment on China's stimulus, cleaner positioning, and CTA short-covering flows also contributed.
insights INSIGHT
Brent Price and Fair Value
Brent oil price aligned with its fair value estimate of $75 for January after a period of discrepancy.
This gap, which reached nearly $10, was likely due to weaker than expected crude demand growth in 2024.
Get the Snipd Podcast app to discover more snips from this episode
Natasha Kaneva, Head of Global Commodities Research
Between December 23 and January 8, oil prices rose over 6%, with Brent hitting $77/bbl and WTI nearly $75/bbl, a three-month high. The gap between realized and forecasted prices, which widened to nearly $10 last year, has now closed, aligning Brent with our $75 fair value for January. This price action is likely driven by concerns over supply disruptions from tightening sanctions, low oil stockpiles, freezing temperatures in the US and Europe, improved sentiment on China’s stimulus, cleaner positioning, and CTA short-covering flows. We expect prices to remain stable for most of the year, dipping below $70 in the final quarter, averaging $73 for the year.
At Any Rate