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Morgan Stanley is taking a more upbeat view of global oil markets in 2024, citing recent inventory declines and raising its estimate for demand growth this year, while reducing its forecast for non-OPEC supply.
They raised their expected price range for Brent to between $80 and $85 a barrel from $75 to $80 a barrel previously.
“The oil market has been tighter than expected and that has forward-looking implications,” analysts at Morgan Stanley said in a report Monday. “Supply has been lower than expected, partly due to OPEC but also due to the U.S.”
Oil demand appears to be solid, and upward revisions to flight schedules suggest “meaningfully higher” jet fuel consumption this summer, according to the report.
Morgan Stanley raised its estimate for 2024 crude demand growth to 1.5 million barrels a day from 1.3 million barrels a day, while trimming its non-OPEC supply growth estimate to 1.5 million barrels a day from 1.7 million.
“Given OPEC compliance has been encouraging so far, we expect the oil market to remain in balance this year, rather than in a small surplus as previously forecast,” they added.
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