The relative resilience of oil prices in the face of worries about US monetary policy and the health of China’s economy suggest that $100 will act as a floor for the price of a barrel of Brent for a while longer, especially given the additional support provided by the crisis in Egypt. Indeed, the collapse of the Brent-WTI spread means that $100 might now be a temporary floor for the traditional US benchmark too. Nonetheless, we continue to expect both Brent and WTI to end the year below this level, as global demand remains sluggish, supply is ample, and Middle East worries fade again.
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