Oil at the highs of the day

Headline are pointing out that WTI hit $85 today for the first time since 2014 but the chart to watch at the moment is brent, which is having a look at the October 2018 high of $86.74.

The high so far is $86.51, so we're less than a quarter-cent away.

Oil at the highs of the day

On the weekend, Nigeria pushed back against OPEC raising production while Saudi Arabia's oil minister indicated the cartel would remain cautious about the increase of oil production.

"The crisis is somehow contained but it is not yet over, we must be careful not to take things for granted," said Saudi Minister of Energy Abdelaziz bin Salman,

Goldman Sachs has nailed the oil call this year and is now highlighting upside risks to brent above $90 due to gas-to-oil switching, saying it may add 1 mbpd of demand. Last week, I noted that Scotia believes it will add 1.2 mbpd of demand.

"We would need prices to rise to $110 barrel to stifle demand enough to balance the market deficit we currently see in Q12022 given our expectations that OPEC+ continues on the current path of +0.4 mb/d per month increase in quotas," Goldman wrote.