Oil prices to remain supported amid OPEC output cuts - ANZ

Analysts at Australia and New Zealand Banking Group (ANZ) offer their oil-price outlook heading amid US-Iran geopolitical risks and ahead of the key OPEC JMMC meeting due later on Thursday.

Key Quotes:

“Replacement of Saudi Arabia's Energy Minister, Khalid Al-Falih, with Prince Abdulaziz al Salman ...  We don't see the move as a prelude to significant change

As OPEC and its allied producers (such as Russia) meet in Abu Dhabi, they face unprecedented uncertainty. 

Tension between the US and Iran/Venezuela continues to impact the market. 

Trade tensions are now also weighing on manufacturing activity.

Global vehicle sales, a key determinant of gasoline demand are on track to fall 6% in 2019

PMIs remain weak across the world.

We have subsequently reduced our forecast oil demand growth to 1mb/d this year (from 1.2mb/d).

Even so, we see sizeable stock drawdowns in Q4.

With crude oil well below Saudi Arabia's target of USD80/bbl, we feel they have no choice but to continue the current production cut agreement to help support current prices. However, the ability to push prices higher looks limited.”