Citi Wealth Insights

Oil looks primed for upside moves now, and price spikes through 2019, given low inventories and acute geopolitical supply disruption risks. But how long could this last?

In this report, Citi analysts explore three cases of OPEC+ projection cuts and their respective inventory trajectories.

Recent slowdown in the global growth outlook, economic divergence and associated slowdown in trade has undermined demand for commodities.

The WTI declined 27% in the past six weeks to $55.50, back to the $40-$60 range that existed for most of 2015-17.

The petroleum complex was down 5-10% in October due to a wide variety of factors, largely seasonal, but consistent with the drop in global equities.

While Citi’s Brent crude price forecast remains at $79 per barrel for Q4 2018, recent price trends warrant an assessment of what the risk of sustained higher oil prices mean for Asia.