The global oil market may have returned to a surplus, with JPMorgan estimating excess supply of 1.1 million barrels per day in September and 1.4 million in October. Analysts at Goldman Sachs also described the market as balanced in those months, as high prices curbed demand and fears of a shortfall eased.
JPMorgan said October’s estimated surplus was close to last year’s average of 1.3 million barrels per day. Goldman Sachs reported no decline in global oil inventories over the past two months, following earlier stock draws that had helped limit fuel prices. The bank cited recovering exports from the Persian Gulf, even as Iranian attacks on tankers in the Strait of Hormuz intensified. Five such attacks had been reported since Sunday alone.
Prices, however, remain well above their levels at the start of the year, in both futures and physical markets. The war premium has weakened somewhat but remains in place, the report said, following the Democrats’ sweeping victory in the U.S. midterm elections.
Vortexa estimated oil flows through the Strait of Hormuz at 14 million barrels a day, including condensates, or 86% of pre-war levels. But analyst George Morris said October data showed Middle East seaborne oil exports had edged down from recent post-war highs amid increased risks in the strait.
The International Energy Agency’s latest monthly Oil Market Report put oil demand destruction this year at 2.6 million barrels per day. It estimated that supply recovered by 2.5 million barrels per day in September, while forecasting an annual supply decline of 5.8 million barrels per day, to 100.7 million barrels per day.
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