BofAML: El petróleo y la fuerza de la gravedad (Global Energy Weekly)

Redacción - Jueves, 25 de Febrero

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Global Energy Weekly: Heavy gravity forces • Light-heavy crude oil spreads have blown out in recent weeks, briefly pushing bitumen prices into single digits •  Yet we now see near-term relief on oil sands maintenance, an OPEC output freeze, and mounting credit problems in Venezuela •  Medium-term, heavy will still weaken against light as crude gravity drops and demand for light products keeps rising

Heavy crude oil has really struggled in the past month

As we initially anticipated last year (see Relative value in oil), light-heavy crude oil spreads have blown out in recent weeks. Worryingly, as light-spreads widened on a bear crude market, Canadian bitumen prices sank into single digits for almost a full month. The problem is not restricted to Canada, of course. Other heavy crude oil grades around the world have not fared much better, as diverging crude and petroleum product supply and demand trends have led to wider light-heavy crude spreads across most regions.

Yet we now see near-term relief for light-heavy spreads

The pressure on heavy oil producers has become so big that many cannot even cover operating cash expenses, sowing the seeds of temporary relief for light-heavy spreads. Looking into the next three months, we see a hefty oil sands maintenance season. The announced OPEC output freeze will also help. Moreover, credit problems in Venezuela and elsewhere keep mounting (see Frozen oil), placing heavy oil output at risk. And last but not least, the risk of recession has increased. This last factor will not help oil prices per se, but it could lead to tighter light-heavy spreads near-term.

Medium-term, rising OPEC output still means heavier oil

Even then, we still believe heavy will weaken against light oil in the medium term as crude gravity drops and demand for light petroleum products keeps rising. Beyond the specifics, the fact is that OPEC is waging a price war against non-OPEC. As such, we see non-OPEC supply falling over the next two years and only recovering 2015 levels by 2020. This implies OPEC supply should increase as Iran makes a comeback and Saudi extends its market share grab. Thus, gravity for the average barrel will likely fall structurally, and keep pressing light heavy spreads down to levels last seen in the mid-2000s.

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