RE:RE:SPR BID and AWARD contract dates - a repeat ... "The release of strategic government oil reserves should ease some market tightness over the coming months, reducing the need for oil prices to rise to trigger near-term demand destruction," said Giovanni Staunovo, strategist at UBS, in a note to investors Monday morning. "Some of the market tightness caused by the self-sanctioning of Russian crude buyers — either in fear of future sanctions or for reputational reasons — should ease."
Still, the market is finely balanced, and OPEC+ nations have so far refused to pump more oil. American oil companies, remembering the financial toll taken when prices collapsed during the early days of the pandemic, have also been reluctant to open the spigots again.
UBS slashed its near-term oil forecast by $10 a barrel, but it still predicts Brent will bounce back to $115 a barrel by June.
In other words: high oil prices are here to stay. Unless the bottom falls out of the economy.