Things that remind me of the 60s: tie-dye, flower crowns, the space race, psychedelics, and the front-month Brent futures contract. Bearish sentiment almost appeared omnipresent this week in Brent, with the prompt Nov’24 futures contract dipping below $70/bbl for the first time since December 2021. This sell-off emerged due to heightened anxiety regarding an oil surplus in markets, worsened by easing tensions in Libya and OPEC+ enjoying a textbook “will they/won’t they” romance with the idea of injecting more supply into the market. On the demand end of things, 10 Sep’s sell-off came with OPEC’s Sep’24 OMR, where the producer group said world oil demand in 2024 would rise by 2.03mb/d (prev: 2.11mb/d). The IEA added to this on Thursday, removing 70kb/d from its 2024 oil demand growth m/m to 900kb/d amid a slowdown in Chinese demand. While we now have more support for Brent, with Francine also simmering to tropical storm status, we will need much more momentum to energise the crude bulls.
