Group 1 - RBC Capital Markets LLC predicts that global oil supply growth in the second half of the year will be nearly four times the increase in demand, leading to increased inventory and downward pressure on oil prices [1] - The report indicates that global crude oil production is expected to rise by 2.3 million barrels per day in the second half, significantly exceeding the anticipated demand increase of 600,000 barrels per day [1] - RBC forecasts that the average price of Brent crude oil will be around $56.50 per barrel in the fourth quarter of this year and $56.25 per barrel in 2026 [1] Group 2 - Current physical market supply is tight, but this supporting factor may gradually diminish [1] - The latest quote for Brent crude oil futures in the London market is above $70 per barrel [1]

Investment Rating - The report provides a bullish outlook on the oil market, indicating a modestly bullish positioning on oil [17]. Core Insights - The global oil market is expected to experience a surplus in 2025 and 2026, with quarterly global oil supply and demand balances projected [25]. - Global oil demand is anticipated to grow by 0.7 million barrels per day (Mb/d) in 2025 and 0.8 Mb/d in 2026, with total demand reaching approximately 106.2 Mb/d by 2030 [34][37]. - The report forecasts Brent crude oil prices to average $65.99 per barrel in 2025, with a gradual increase to $75.00 by 2028 [3]. Summary by Sections Oil Price Forecast - The UBS forecast for Brent crude oil prices is $74.97 in 1Q25, declining to $62.00 in 3Q25 and 4Q25, before recovering to $65.99 in 2025 [3]. Global Oil Supply and Demand - Global oil supply is projected to grow by 1.4 Mb/d in 2025 and 0.8 Mb/d in 2026, with significant contributions from non-OPEC+ countries [50][53]. - The total global oil demand is expected to reach 103.9 Mb/d in 2025, with the US contributing 20.5 Mb/d [129]. Geopolitical Factors - The report highlights the impact of geopolitical tensions, particularly in the Persian Gulf, on oil supply and pricing, with a risk premium expected to remain elevated due to potential disruptions [11][5]. OPEC+ Dynamics - OPEC+ is expected to gradually unwind production cuts, with a cumulative increase of 2.2 Mb/d planned, affecting global supply dynamics [64][66]. Inventory Trends - Global observed oil inventories rose by 25 million barrels in March, indicating a build-up in supply [104]. Capex and Project Developments - Global upstream capital expenditure is expected to increase by 2% in 2025, reflecting ongoing investments in oil and gas projects [121]. Regional Demand Insights - The report notes that US gasoline demand is projected to align with 2024 levels in 2Q25, indicating stable consumption patterns [43]. Long-term Outlook - The long-term oil price forecast suggests a gradual increase in prices, with a breakeven price for various regions and types of oil production outlined [124].

Core Viewpoint - The content emphasizes the importance of conducting personal due diligence and consulting competent advisors before making any financial decisions, particularly in the context of investments and trading [1]. Group 1 - The website provides general news, publications, and personal analysis intended for educational and research purposes [1]. - It explicitly states that the information does not constitute any recommendation or advice for investment actions [1]. - Users are advised to perform their own research and consider their financial situation before making decisions [1]. Group 2 - The website includes information about complex financial instruments such as cryptocurrencies and contracts for difference (CFDs), which carry a high risk of losing money [1]. - It encourages users to understand how these instruments work and the associated risks before investing [1].

Investment Rating - The report indicates a cautious outlook on oil prices, with Brent expected to average $60 for the rest of 2025 and $56 in 2026 [6]. Core Insights - Brent prices increased by $3 to $67 per barrel due to fading demand fears, downside risks to North American supply, and geopolitical tensions [1] - Mixed signals regarding physical tightness are observed, with rising inventories and OPEC+ supply concerns [4][5] - The US May jobs report suggests a slight economic slowdown, but fears regarding demand have eased as the economy is not in recession [2] Supply and Demand Dynamics - US crude production reached an all-time high of 13.49 million barrels per day (mb/d) in March, despite a significant drop in the US oil rig count [3][26] - Global visible commercial oil stocks have risen by 1.0 mb/d year-to-date, with notable increases in China, the US, and on water [10][4] - Trackable net supply edged down by 0.2 mb/d week-over-week, while trackable inventories rose [14] OPEC+ Supply Signals - OPEC+ supply signals were mixed, with support from supply misses in Russia and Iraq, but downward pressure from Saudi Arabia's desire to increase production [5][8] - The long-to-short oil ratio stands at the 58th percentile, indicating a relatively balanced positioning in the market [76] Price Trends and Forecasts - The average crude basis remains elevated but has edged down slightly, while the average crude prompt timespread has increased [56] - The report suggests that lower-than-anticipated spare capacity represents an upside risk to the price forecast [8]

Core Viewpoint - The content emphasizes the importance of conducting personal due diligence and consulting competent advisors before making any financial decisions, particularly in the context of investments and trading [1]. Group 1 - The website provides general news, publications, and personal analysis intended for educational and research purposes [1]. - It explicitly states that the information does not constitute any recommendation or advice for investment actions [1]. - Users are advised to perform their own research and consider their financial situation before making decisions [1]. Group 2 - The website includes information about complex financial instruments such as cryptocurrencies and contracts for difference (CFDs), which carry a high risk of losing money [1]. - It encourages users to understand how these instruments work and the associated risks before investing [1].

Investment Ratings - Petrobras: Buy with a 12-month price target of BRL 38.80 [18] - Brava Energia: Sell with a 12-month price target of BRL 15.80 [19] - PetroReconcavo: Neutral with a 12-month price target of BRL 16.50 [20] - Ultrapar: Buy with a 12-month price target of BRL 22.40 [21] - Cosan: Neutral with a 12-month price target of BRL 9.10 [22] - Vibra Energia: Neutral with a 12-month price target of BRL 20.30 [23] Core Insights - The report highlights a cautious outlook for oil prices, with expectations of average Brent oil prices at USD 56/bbl in 2026, influenced by solid supply growth outside the US shale [14] - Companies in the oil and gas sector are adjusting their capital expenditure (CAPEX) plans in response to lower oil prices, with Brava already reducing its investment plan for 2025 [2][12] - The fuel distribution segment is facing challenges from inventory losses due to recent price reductions by Petrobras, which may lead to lower margins in the short term [3][8] Summary by Company Petrobras - CAPEX remains resilient with 98% of upstream investments breakeven at or below USD 45/bbl, indicating no major adjustments in the short term [7] - The company is cautious about shareholder remuneration, recognizing potential increases in indebtedness due to lower oil prices [7] - Petrobras aims to avoid passing global market volatility to domestic fuel prices while aligning with international trends [7] Brava Energia - The company plans to deploy USD 450 million in CAPEX for 2025, a reduction from previous plans, primarily affecting onshore investments [12] - Brava expects stable production in the upcoming years, with potential growth in offshore output by 2026 [12] - The decision to cancel the divestment of onshore assets reflects a strategy to maintain a diversified portfolio [12] Vibra Energia - EBITDA in 2Q will be impacted by inventory losses, with a focus on reducing indebtedness through a 40% dividend payout policy [8] - Recent market share data indicates a slight increase in diesel market share, attributed to sales to TRR and unbranded gas stations [8] - The company does not foresee significant impacts from sanctions on Russian diesel imports [8] Ultrapar - The fuel distribution business is experiencing an oversupply effect, but demand is expected to improve in the second half of the year [9] - Ultrapar is positioning Ultragaz for potential investments in renewables, while managing profitability under competitive pressures [9] - The company anticipates leverage to remain within guidance levels despite recent acquisitions [9] PetroReconcavo - The company is maintaining flexibility in capital allocation, with expectations of double-digit production growth this year [12] - It recognizes the need for caution in the current oil price environment but does not plan significant CAPEX adjustments [12] Cosan - Committed to asset sales to improve its interest coverage ratio, with potential working capital pressures from recent IOF changes [13] - Raizen, one of Cosan's investees, is highlighted as being particularly exposed to these changes [13]

Investment Rating - The report maintains a cautious investment rating for the oil industry, with Brent/WTI oil price forecasts set at $60/$56 for the remainder of 2025 and $56/$52 for 2026, which are below the forwards by $4 and $8 respectively [4][8][32]. Core Insights - The price drag from higher Iran supply assumptions and slightly higher than expected OECD commercial stocks offsets the price boost from higher GDP forecasts [3][4]. - Global oil demand growth forecasts for Q4-Q4 have been raised by 0.3mb/d and 0.1mb/d for 2025 and 2026, now projected at 0.6mb/d and 0.4mb/d respectively [5][6]. - The report nudges up Iran's crude supply expectations for 2025H2-2026 to 3.6mb/d, reflecting potential progress on a US-Iran nuclear deal, although the outlook remains uncertain [12][13]. Summary by Sections Oil Price Forecasts - The report maintains Brent/WTI oil price forecasts of $60/$56 for 2025 and $56/$52 for 2026, indicating a cautious outlook due to supply factors [4][8][32]. - The price forecasts have been adjusted slightly upward for May, June, and July 2025 due to a faster-than-expected recovery in risk premiums following the US-China trade deal [6]. Demand and Supply Dynamics - Global oil demand growth is expected to be sluggish, with a forecast of 0.6mb/d in 2025 and 0.4mb/d in 2026, driven by lower tariffs and higher GDP [5][10]. - The report anticipates surpluses of 1.0mb/d and 1.5mb/d in 2025 and 2026 respectively, indicating a potential imbalance in the oil market [30]. Geopolitical Factors - The report highlights the uncertainty surrounding US-Iran relations and the potential impact on Iran's crude supply, which could increase if a nuclear deal is reached [12][13]. - Venezuela's supply forecast has also been nudged up based on higher-than-expected realized production [16]. Economic Scenarios - The report outlines various scenarios for oil prices, indicating that downside risks remain significant due to high spare capacity and potential global economic slowdowns [19][20]. - In a scenario of a global GDP slowdown and a full unwind of OPEC cuts, Brent prices could fall to $40 by late 2026 [23][21].

Investment Rating - The report indicates an upside risk to oil price forecasts due to recent trade de-escalation, estimating a potential increase of $3-4 per barrel to Brent/WTI oil price forecasts of $60/56 for the remainder of 2025 and $56/52 in 2026 [6][26]. Core Insights - The potential election of President Trump poses both upside risks to oil price volatility and downside risks to prices, primarily through impacts on oil demand from tariffs [5][26]. - Recent trade de-escalation has led to an estimated increase in global oil demand growth forecasts for 2025 and 2026 by 0.3 million barrels per day (mb/d) and 0.1 mb/d, respectively, raising demand growth to approximately 0.6 mb/d and 0.4 mb/d [6][26]. - President Trump's inferred preference for WTI oil prices is around $40-50 per barrel, with a tendency to call for lower prices when WTI exceeds $50 and for higher prices when below $30 [13][22]. Summary by Sections Section 1: Price Forecasts - The report estimates an upside risk of $3-4 per barrel to Brent/WTI oil price forecasts due to trade de-escalation and reduced recession risks [6][26]. - The expected global oil demand growth for 2025 and 2026 has been adjusted upwards due to improved GDP growth outlooks in the US, China, and Europe [6][26]. Section 2: Presidential Influence - President Trump's social media activity indicates a strong focus on energy markets, with nearly 900 posts related to energy since joining Twitter [8][22]. - The analysis reveals that Trump's posts about oil prices tend to increase as elections approach, reflecting his political strategy [8][22]. Section 3: Sanctions and Price Sensitivity - The report notes that Trump's propensity to post about oil sanctions decreases as prices rise, particularly when WTI is in the $60s or $70s, suggesting limited upside risks to prices from potential drops in sanctioned supply [22][26]. - The findings indicate that underinvestment and OPEC+ production quotas are more significant constraints on production volumes than sanctions [22][26].

Investment Rating - The report indicates a lower outlook for Brent prices, with forecasts reduced by $5-10 per barrel due to increased OPEC supply and anticipated market surplus [1][14][26]. Core Insights - OPEC's recent quota increase of 411 kb/d in May and another similar increase in June suggests a trend towards higher production levels, leading to a projected market surplus of approximately 1.1 mb/d in 2H25 and 1.9 mb/d in 2026 [10][14][26]. - The Brent price is expected to decline to around $55 per barrel by 1H26, down from a previous estimate of $65 per barrel, reflecting the anticipated oversupply in the market [14][26][30]. - Historical parallels are drawn to the late 1997 downturn, where a similar increase in OPEC production coincided with a significant demand slump, resulting in a drastic price decline [21][22][25]. Supply and Demand Summary - OPEC supply is projected to grow by an additional 0.4 mb/d in both 2025 and 2026, while non-OPEC supply is expected to increase by 1.2 mb/d in 2025 and 1.1 mb/d in 2026, leading to a total liquids balance surplus of approximately 1 mb/d in 2025 and 1.9 mb/d in 2026 [26][27][30]. - Total oil liquids demand is forecasted to grow by 0.7 mb/d in 2025 and 0.6 mb/d in 2026, which is significantly outpaced by supply growth [26][27][30]. Price Forecasts - The report outlines a cautious price outlook, with Brent prices expected to remain at the lower end of the forecast range, likely settling in the mid-$50s per barrel by mid-2026 [29][30][36]. - The relationship between oil prices and shale break-evens suggests that prices may need to fall below the mid-$50s to balance the market, depending on demand impacts from external factors such as tariffs [30][31][36].

Investment Rating - The report indicates a modestly reduced oil price forecast due to higher OPEC supply assumptions, with Brent/WTI averaging $60/56 in the remainder of 2025 and $56/52 in 2026 [8][12][13] Core Insights - OPEC8+ countries decided to increase production by 411 thousand barrels per day (kb/d) month-over-month for June, reflecting low inventories and a strategic shift to support internal cohesion and discipline US shale supply [1][4] - The expected production increase for July has been adjusted to 0.41 million barrels per day (mb/d) from a previous estimate of 0.14 mb/d, driven by recent economic data suggesting resilient demand [5][8] - The oil price forecast has been nudged down by $2-3, with the new average prices reflecting adjustments in supply expectations and economic activity [8][12] Summary by Sections OPEC+ Production Decisions - The decision to raise production aligns with a broader strategy to manage compliance among member countries and address low oil inventories [4][5] - The report highlights that the production increase is likely to continue if compliance improves among lagging countries like Iraq and Kazakhstan [3][4] Economic Activity and Demand - Recent US economic data, including payroll reports and ISM readings, indicate solid momentum, suggesting that a slowdown in demand may not be imminent [5][7] - The report emphasizes the importance of monitoring compliance and economic indicators to assess future production levels and price forecasts [7][8] Price Forecast Adjustments - The updated oil price forecast reflects a downward adjustment due to increased supply expectations, with Brent and WTI prices expected to average lower than previously forecasted [8][12] - The report maintains that high spare capacity and recession risks skew the risks to oil prices to the downside despite tight spot fundamentals [9][10]