Goldman Sachs on oil – expects a strong recovery in demand

Comments overnight ICYMI from Goldman’s global head of commodities research Currie

Expects a strong recovery in demand except for business travel:
  • “Before we used to have these internal meetings and things of that nature, and I think this is going to be way more Zoom-oriented, other types of substitutes”
Which has implications for airline travel:
  • “Look at the routes that the airlines are planning when they come back, they’re not going to be at the same level that they were previously.”
Moving on …
  • We believe demand will exhibit a V-shaped recovery
Oil supply could take a little longer to get back online as wells need to come back online, companies need to increase spending:
  • supply will exhibit an L-shaped recovery
Putting the two together:
  • could mean demand rises above supply as early as June 1
  • while demand returns to normal it will be from a base with less business travel
(That last remark I read as demand will not return to normal but to a lower new normal)
Comments overnight ICYMI from Goldman's global head of commodities research Currie