Commodities and Futures News

Trump win points to net bearish oil outlook: Citi

2024.11.07 10:35

Trump win points to net bearish oil outlook: Citi

Investing.com — A second Trump presidency could signal a bearish outlook for oil markets, according to Citi, as it raises potential for shifts in trade policies, OPEC+ dynamics, and domestic energy regulations.

Following Trump’s victory, initially dipped nearly $2 per barrel before recovering. Citi strategists anticipate downward pressure on prices to continue moving into 2025, with the average Brent price forecast at $60 per barrel, around 20% lower than current levels.

This reflects potential trade tensions and increased supply from OPEC+ nations, alongside a US energy policy likely to support domestic fossil fuels.

Citi highlights that Trump’s return could lead to renewed tariffs, which might dampen global economic growth, particularly in Europe and China. The report notes that a 10% US tariff on global imports could reduce global GDP by 0.4%, while a targeted 60% tariff on Chinese imports might reduce China’s GDP by 2.4%.

“This could further dent into global oil demand growth, especially for diesel as the fuel of international logistics, posing downside risks to our current global oil demand growth expectations of 0.9-m b/d for next year,” strategists led by Francesco Martoccia said in a note.

On the supply side, Trump’s influence could prompt OPEC+ to accelerate the easing of production cuts, potentially boosting supply in global markets.

Strategists point out that Trump may adopt a less aggressive stance on “maximum pressure” sanctions, unlike his first term, though risks of renewed sanctions on Venezuela and Iran persist, which could lend some support to oil prices.

Trump’s policies might also benefit US energy producers through potential reversals of Biden-era regulations. This could mean lower royalty rates and eased environmental restrictions, potentially making federal lands more accessible for oil and gas exploration.

However, Citi expects a limited immediate impact on overall production due to current market constraints.

Moreover, Trump may maintain some provisions of the Inflation Reduction Act (IRA), especially given its popularity in Republican states benefiting from significant renewable investments. However, stricter criteria for electric vehicle subsidies could dampen EV adoption rates, reducing a demand shift away from fossil fuels.



Source link

Related Articles

Back to top button
bitcoin
Bitcoin (BTC) $ 76,147.40 2.03%
vested-xor
Vested XOR (VXOR) $ 3,405.08 99,999.99%
ethereum
Ethereum (ETH) $ 2,852.74 7.32%
tether
Tether (USDT) $ 1.00 0.08%
solana
Solana (SOL) $ 194.20 4.33%
bnb
BNB (BNB) $ 600.27 2.54%
usd-coin
USDC (USDC) $ 1.00 0.06%
xrp
XRP (XRP) $ 0.55293 3.61%
dogecoin
Dogecoin (DOGE) $ 0.194245 0.81%
staked-ether
Lido Staked Ether (STETH) $ 2,848.49 7.28%
cardano
Cardano (ADA) $ 0.39262 10.58%
tron
TRON (TRX) $ 0.160537 2.10%
the-open-network
Toncoin (TON) $ 4.92 4.20%
wrapped-steth
Wrapped stETH (WSTETH) $ 3,376.56 7.37%
avalanche-2
Avalanche (AVAX) $ 27.61 4.61%
shiba-inu
Shiba Inu (SHIB) $ 0.000019 2.06%
wrapped-bitcoin
Wrapped Bitcoin (WBTC) $ 75,930.34 1.90%
weth
WETH (WETH) $ 2,847.53 7.22%
chainlink
Chainlink (LINK) $ 12.51 5.36%
bitcoin-cash
Bitcoin Cash (BCH) $ 383.82 3.24%
sui
Sui (SUI) $ 2.32 2.25%
polkadot
Polkadot (DOT) $ 4.15 2.00%
leo-token
LEO Token (LEO) $ 6.24 0.19%
usds
USDS (USDS) $ 1.01 0.05%
uniswap
Uniswap (UNI) $ 9.15 1.24%
litecoin
Litecoin (LTC) $ 72.15 3.91%
wrapped-eeth
Wrapped eETH (WEETH) $ 2,999.89 7.26%
near
NEAR Protocol (NEAR) $ 4.23 2.84%
aptos
Aptos (APT) $ 9.75 4.59%
pepe
Pepe (PEPE) $ 0.00001 11.44%
bittensor
Bittensor (TAO) $ 519.54 0.09%
fetch-ai
Artificial Superintelligence Alliance (FET) $ 1.43 1.71%
internet-computer
Internet Computer (ICP) $ 7.75 1.19%
dai
Dai (DAI) $ 1.00 0.03%
monero
Monero (XMR) $ 165.93 1.99%
ethereum-classic
Ethereum Classic (ETC) $ 20.07 4.75%
stellar
Stellar (XLM) $ 0.100012 3.96%
kaspa
Kaspa (KAS) $ 0.118819 0.81%
ethena-usde
Ethena USDe (USDE) $ 1.00 0.14%
whitebit
WhiteBIT Coin (WBT) $ 19.40 0.45%
aave
Aave (AAVE) $ 186.14 10.05%
polygon-ecosystem-token
POL (ex-MATIC) (POL) $ 0.344664 5.49%
blockstack
Stacks (STX) $ 1.68 0.85%
okb
OKB (OKB) $ 40.36 3.22%
crypto-com-chain
Cronos (CRO) $ 0.088971 5.04%
dogwifcoin
dogwifhat (WIF) $ 2.38 1.99%
first-digital-usd
First Digital USD (FDUSD) $ 1.00 0.01%
arbitrum
Arbitrum (ARB) $ 0.575256 9.38%
filecoin
Filecoin (FIL) $ 3.77 4.06%
mantle
Mantle (MNT) $ 0.662004 12.27%