Tightness in the Oil market has eased as growth in non-OPEC supply has more than offset strong demand. A balanced Oil market now remains reliant on production cuts being maintained well into 2024.

If Saudi Arabia were to reverse its unilateral production cuts, the market would suddenly be awash with Oil and prices would likely drop below $70/bbl. However, any supply disruptions in the Middle East could see them above $100/bbl. 

On the balance of risks, we think Saudi Arabia will extend its production cuts into 2024 if they want prices to remain above $80/bbl.