At the time of writing, Brent is currently trading around $43/bbl, supported by OPEC+ production cuts, lower US crude supply and demand recovery from the COVID-19 crisis vs. April 20. The market also recently experienced optimism with a more solid potential of a COVID-19 vaccine on the horizon
3Q20 global oil demand increased significantly from the lows seen in 2Q20, caused by less strict COVID-19 control measures and seasonal trends supporting transport fuel demand.
There have been no recent revisions to the agreed OPEC+ cuts, currently at 7.7mbd for Aug-Dec ’20. However, OPEC+ supply decreased in Sep-20, with a m-o-m fall of 360kbd, as the compliance rate improved for members previously not meeting targets
Additional supply risks have materialised with the return of Libyan crude supply from Sep-20 after an eight-month blockade
OECD product inventories continued to build at historically high levels in 3Q20 although the rate was slower than 2Q20