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Barclays keeps 2021 oil price outlook, supported by vaccine boost

Published 23/11/2020, 07:40
© Reuters. The logo of Barclays is seen on the top of one of its branch in Madrid
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(Reuters) - Barclays (LON:BARC) kept its "above consensus" 2021 oil price forecasts on Monday, predicting Brent at $53 a barrel based on output discipline by OPEC and its allies, and based on a potential COVID-19 vaccine boosting demand in the second half.

Potential rollouts of high-efficacy vaccines in the short term would be a turning point for demand as it could lead to a more sustainable economic recovery, the bank said in a note.

It forecast Brent at an average $53 a barrel and U.S. West Texas Intermediate (WTI) crude at $50 per barrel in 2021.

Sources have told Reuters that the Organization of the Petroleum Exporting Countries, Russia and its allies, known as OPEC+, are leaning towards postponing of a planned January increase to oil output by at least three months.

OPEC+ was due to raise output by 2 million barrels per day in January as part of a steady easing of record supply cuts agreed this year.

"We expect the OPEC+ group to delay the ratcheting up of production targets by three months when the group meets later this month," the bank said.

Goldman Sachs (NYSE:GS) also said this month that it expected the group to delay their planned output increase.

© Reuters. The logo of Barclays is seen on the top of one of its branch in Madrid

Brent traded around $45.30 on Monday and WTI was around $43, lifted by optimism about a recovery in demand thanks to successful coronavirus vaccine trials, although new lockdowns around the world capped gains. [O/R]

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