U.S. | Oil Prices Outlook. September 2020

Summary

Faltering demand is preventing oil prices to experience a sustained increase. Fundamentals are consistent with our baseline scenario. In the absence of a vaccine, we expect prices to remain below $45 per barrel for the rest of the year.

Key points

• Key points:
• Petroleum demand is recovering, but continues to be capped by the pandemic’s effects on economic activity.
• OPEC+ compliance has been supportive of prices, however, output cuts are projected to slow down in the following months.
• Although still above trend, inventories have subsided, easing pressures on storage capacity.
• In the U.S., government intervention has helped avoid a massive wave of bankruptcies.
• Prospects could significantly tilt to the upside if a vaccine is available in 4Q20.

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