In an oil and gasoline report despatched to Rigzone lately by the Macquarie workforce, Macquarie strategists, together with Vikas Dwivedi, famous that oil’s “Fermi Paradox [is] nearing an finish”, including that “onshore shares [are] beginning to construct”.
“We proceed to anticipate a closely oversupplied market,” the strategists stated within the report.
“We estimate a 1Q26 peak supply-demand surplus of over 4 million barrels per day. Indicators of the excess are exhibiting with continued offshore builds, rising onshore builds, and intensely sturdy freight charges,” they added.
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“We estimate that roughly one-third of the offshore construct is long-haul shipments from the Americas to Asia,” they continued.
Within the report, the strategists revealed that they anticipate onshore builds to speed up by way of year-end 2025 and into early 2026, a course of which they stated “ought to drive Brent in the direction of the low $50 vary, with a chance of reaching $45 per barrel”.
“Because the finish of August, offshore inventories have elevated by roughly 250 million barrels and onshore storage up by ~30 million barrels,” the strategists highlighted within the report.
“Prior to now month, the pattern has accelerated with onshore … [plus] offshore shares constructing by ~ three million barrels per day. But, construction stays backwardated, as AB barrels continued clearing East,” they added.
A separate report despatched to Rigzone by the Macquarie workforce on December 5 confirmed that Macquarie was projecting that the Brent worth will common $68.21 per barrel general in 2025 and $60.75 per barrel general in 2026.
In response to that report, Macquarie expects the Brent worth to common $63.00 per barrel within the fourth quarter of this yr, $57.00 per barrel within the first quarter of 2026, $59.00 per barrel within the second quarter, $60.00 per barrel within the third quarter, and $67.00 per barrel within the fourth quarter.
In that report, Macquarie strategists, together with Dwivedi, stated, “as Q3 got here to an in depth and This fall has commenced, a hypothesized heavy oil surplus has begun to materialize in crude shares on land and (primarily) on water”.
“This has come alongside continued provide energy from key non-OPEC areas (U.S. and Brazil) and traditionally troubled OPEC producers (Libya, Iran),” they added.
“We proceed to mannequin a considerably loosening FY25 steadiness with provide progress of three.2 million barrels per day in comparison with a mere 0.8 million barrels per day of demand progress,” they continued.
“Notably, in keeping with the big builds in oil on water, world crude loadings seem up ~4.4 million barrels per day yr on yr from Sep.-Nov., representing a sequential improve of ~2.8 million barrels per day vs. the prior three months,” they stated.
The strategists went on to warn in that report that they “stay firmly bearish on crude oil”.
“Our base case is for Brent to go to the low $50s with an affordable probability of reaching $45 earlier than bodily and paper supply-demand changes create a flooring for costs to recuperate from,” they added.
“Alongside this worth path, we additionally anticipate a contango ahead curve as provide exceeds out there refining capability. Our views are constructed on our extraordinarily lengthy world supply-demand steadiness estimates which attain over 4 million barrels per day in 1Q26,” they continued.
The strategists went on to state in that report that, though their surplus estimates look like on the excessive finish of forecasts, they’re uncharacteristically a part of the consensus view by way of the route of balances and worth outlook.
On its web site, the SETI Institute states that the Fermi Paradox “highlights a profound contradiction: if clever alien civilizations are frequent and will develop throughout the galaxy inside simply tens of thousands and thousands of years – an expanse minuscule in comparison with the galaxy’s age – then ‘the place is everyone?’”.
To contact the creator, electronic mail andreas.exarheas@rigzone.com
