In a recently released note by Riyadh-based Jadwa Investment, the bank finds a “clear” Saudi strategy to maintain market share with pressures on prices expected in Q1 2015.
Oil Prices.
“Global oil balances will increase in Q1 2015 as oil demand remains subdued but oil supply continues to expand from the US,
Russia and Iraq. All of this will maintain pressure on oil prices in the first quarter,” the bank noted.
“Beyond Q1 2015 we see prices recovering, with a sharper rebound in H2 2015, due to i) stockpiling of crude, especially in India and China ii) the occurrence of contango resulting in some surplus leaving the market iii) quicker than projected reduction in
US shale oil and iv) a pickup in oil demand due to improvements in global economic growth, partially supported by the windfall
gained from lower oil prices.”
[To read the full .PDF report from Jadwa Investment, click here]
