Weekend ReadEverything goes in cycles and the price of oil will go up sooner or later....... Oil deficit coming? World may be consuming more than it pumps by year end, analysts warn Aaron Clark, Bloomberg News | May 27, 2015 12:16 PM ET More from Bloomberg News . U.S. crude inventories probably shrank for a fourth week through May 22 after surging to the highest in 85 years, a Bloomberg survey showed. Daniel Acker/BloombergU.S. crude inventories probably shrank for a fourth week through May 22 after surging to the highest in 85 years, a Bloomberg survey showed.. Twitter Google+ LinkedIn Email Typo? More . Make the most of abundant oil because by the end of the year the world may be consuming more than it pumps. The global crude market will shift into a deepening deficit in the fourth quarter amid a draw-down in U.S. stockpiles, according to Standard Chartered Plc. While Qatar’s former oil minister says there’s currently a surplus of 2 million barrels a day, Sanford C. Bernstein Ltd. sees demand outpacing supply by 1.5 million a day by the fourth quarter. Oil has recovered more than 40 per cent since January on signs that a slowdown in U.S. drilling will alleviate the glut that drove prices to the lowest in six years. U.S. crude inventories probably shrank for a fourth week through May 22 after surging to the highest in 85 years, a Bloomberg survey showed. “By the second half of this year we will go from being oversupplied to being undersupplied,” Neil Beveridge, Bernstein’s Hong Kong-based analyst, said by phone Wednesday. “Once we see U.S. production growth come to an end, with demand growth running at about 1.5 million barrels a day, we’ll see a significant tightening in the market.” Brent crude was at US$64.26 a barrel on the London-based ICE Futures Europe exchange on Wednesday, up 42 per cent from a low of US$45.19 on Jan. 13. West Texas Intermediate, the U.S. benchmark grade, was at US$58.70 after dropping as low as US$42.03 on March 18, the lowest price since the same month in 2009. Related Oil’s whodunit moment coming as millions of barrels set to vanish from company inventories The world’s biggest oil exporter has quietly seized a market milestone from the U.S. . Brent Rebound Brent will rebound to US$80 a barrel in the short-term while WTI will rise to a range of US$70 to US$75, according to Bernstein. Standard Chartered sees the European benchmark at US$90 by the fourth quarter and WTI at US$84. “The start of sustained U.S. inventory declines is a significant milestone for the oil market,” analysts at the bank including Paul Horsnell wrote in a report dated May 26. “Virtually all the global build in commercial inventories so far in 2015 has occurred in the U.S. The end of this build is likely to be an early warning of a shift into deficit for the global market as a whole.” While oil demand may pick up in summer, the slowdown in U.S. drilling isn’t big enough to lower production and excessive supply will continue to prolong the surplus, according to Goldman Sachs Group Inc. The market will remain “well oversupplied” through 2016, the bank forecast in a May 22 report, also citing sharp growth in output from low-cost suppliers. U.S. crude inventories decreased to 482.2 million barrels through May 15, the Energy Information Administration reported last week. Supplies are still near the highest level since 1930, based on monthly records from the Energy Department’s statistical arm dating back to 1920. –With assistance from Claudia Carpenter in Dubai and Ben Sharples in Melbourne. Bloomberg.com