Citi says Brent crude oil could fall as low as $50 / barrel

Citi forecasts oil prices could drop to $60 per barrel next year if OPEC+ doesn’t increase production cuts.

• Then, from $60, prices could fall further to $50 before rebounding, influenced by financial flows.
• Geopolitical tensions are having minimal long-term impact on oil prices, with weaker rebounds after each spike.
• Markets now see these tensions as opportunities to sell during temporary price increases.
• Citi warns OPEC may lose market confidence in defending $70 oil if output cuts aren’t extended.
• Citi has issued similarly negative forecasts before, which have sometimes been wrong.
• In June, Citi predicted a $60 Brent crude by 2025, advising producers to hedge and investors to take short-term bearish positions.
• Oil prices fell to a nine-month low on concerns about demand and potential supply growth.
• OPEC+ is reconsidering easing production cuts due to the price drop, with Brent crude below $73 and WTI below $70.

The note from Citi was covered by various outlets, summary above ICYMI.

Earlier:

• Crude oil price dips despite OPEC+ considering supply hike delay
• OPEC+ lifeline falls flat, WTI settles down $1.14

Just a few moments ago we had oil inventory data:

• Oil: private survey of inventory shows a headline crude oil draw much larger than expected

Brent catching a bid on it:

This article was written by Eamonn Sheridan at www.forexlive.com.