Crude prices have plunged this week as risk aversion escalates amid the widening banking crisis. However, strategists at ANZ Bank expect the sell-off to be relatively short-lived, with fundamentals pointing to a tightening market.

OPEC to maintain its production cuts announced in late 2022

“For the moment, risks remain to the downside. We have subsequently trimmed our short-term (0-3M) target for Brent crude to $75/bbl.”

“We expect OPEC to keep the production cuts announced in late 2022 in place. Lower prices could also induce further demand, with the US to refill its strategic reserve.”

“As macro issues subside, we expect crude oil prices to push above $100/bbl in the second half of the year.”