Summary of Key Points from the Conference Call Industry Overview - **Industry**: Global Oil Market - **Source**: EIA's September STEO report Core Insights 1. **Market Outlook**: The EIA projects the oil market to be 0.1 million barrels per day (Mb/d) looser than previously estimated, with surpluses of 1.7 Mb/d in 2025 and 1.6 Mb/d in 2026, compared to previous estimates of 1.1 Mb/d for both years [2] 2. **Inventory Builds**: Global oil inventory builds are expected to average over 2 Mb/d from Q3 2025 through Q1 2026 [2] 3. **OPEC+ Production**: OPEC+ crude output is raised by 60,000 barrels per day (kb/d) for 2025, reflecting a full unwinding of the 2.2 Mb/d voluntary cuts [2] 4. **Brent Prices**: The EIA forecasts Brent prices to fall to an average of $59 per barrel in Q4 2025 and further to approximately $50 per barrel in early 2026 [2] Demand and Supply Dynamics 1. **Demand Growth**: - Demand growth forecasts for 2025 were lowered by 85 kb/d to 0.9 Mb/d, primarily due to a weaker outlook in the US [3] - Absolute demand for 2025 was revised up by 90 kb/d to 103.8 Mb/d due to a higher 2024 base [3] - For 2026, demand growth estimates were raised by 90 kb/d to 1.3 Mb/d, driven by stronger growth in the US and OECD Europe [3] 2. **Non-OPEC Supply**: - Non-OPEC+ supply growth projections remain unchanged at 1.5 Mb/d for 2025, but the absolute level was revised higher by 114 kb/d due to a 2024 base revision [4] - For 2026, non-OPEC+ growth supply is revised up by 129 kb/d to 0.8 Mb/d, driven by higher US and Canadian supply [4] Additional Insights 1. **Rig Activity**: Rig activity continues to soften, with August data showing wells drilled down by 1 month-over-month, and DUCs (drilled but uncompleted wells) declining by 48 [4] 2. **Volatility of Oil Prices**: Historical data indicates that oil prices are consistently unpredictable due to various political, geological, and economic factors affecting supply and demand [6] Analyst Information - Analysts involved in the report include Nayoung Kim, Henri Patricot, and Joshua Stone, all from UBS [5] Risk Considerations - The report emphasizes the inherent volatility of oil prices and the unpredictability of market conditions, advising investors to exercise caution [6][30]