Morgan Stanley has revised its expectations for Brent crude prices, citing a delay in the start of OPEC+ production increases and a slower pace of output hikes. The alliance now anticipates an average price of $70 per barrel in the second half of 2025, up from a previous range of $66-$68.
The delay in easing production cuts has led to a revised estimate of a smaller surplus in the market, with Morgan Stanley analysts predicting a reduction of 400,000 barrels per day (bpd) from OPEC producers, excluding Iran, Libya, and Venezuela. This decrease translates to a lower combined output of 700,000 bpd by the fourth quarter of 2025.
As a result, Morgan Stanley has revised its estimates for crude-only balance, reducing the expected surplus from 0.7 million bpd to 0.3 million bpd in 2025. The bank attributed this change to OPEC+’s awareness that demand is not strong enough to absorb the reversal of all production cuts throughout 2025.
Oil prices were on track for a weekly loss, with little movement since the OPEC+ decision on Thursday. Despite the delay and reduced output, Brent crude is expected to reach $70 per barrel by 2025, driven by OPEC+’s revised strategy.
Source: https://oilprice.com/Energy/Energy-General/Morgan-Stanley-Raises-Brent-Oil-Forecast-for-Late-2025-After-OPEC-Move.html