Oil market is “too destructive” – Barclays

Investing.com – The oil market is affected by weak sentiment going into 2025, however Barclays (LON:BARC) sees the chance that the market is just too destructive and dangers might be tilted to the upside. 

At 09:25 ET (14:25 GMT), the benchmark Brent contract fell 0.9% to $71.41 a barrel, and is about to finish the week round 2% decrease.

“The prospect of an oversupplied oil market into 2025 will not be a backdrop that’s more likely to encourage new buyers into vitality equities,” stated analysts at Barclays, in a be aware. “But there’s a chance that the market is just too destructive on a well-flagged oversupply in oil, and that past 2025 the image is supportive of upper costs.”

Oil market sentiment stays weak into 2025 with each our forecasts and most companies displaying a surplus, even with out OPEC+ reversal of cuts, stated Barclays.

That is prompting vital dialogue throughout the marketplace for the potential of $50-60/bbl oil for 2025.

“We consider the Brent worth will spend extra time above $70/bbl than under it given the supply-demand dynamics have been properly flagged for a while,” Barclays added.

Total, it is vitally attainable that underlying supply-demand balances will tighten relative to expectations into 2025, supporting oil costs, significantly as 2026 balances already display tighter, Barclays stated.

However the degree of OPEC+ spare capability is more likely to restrict upside potential exterior of a fabric uncompensated drop-off in Iranian volumes.