Crude – summer burn

Raise crude oil price estimate to USD65/bbl
Crude oil price (dated Brent) recently reached a new high of USD74/bbl (16 June 2021), averaging USD64/bbl YTD, on improving demand (economic recovery, higher vaccination rollouts) and tighter supply (OPEC+ policy, under-investment). This has led us to raise our in-house crude oil price estimate (dated Brent) to USD65/bbl for 2021 (vs. USD55-60/bbl previously; in line with EIA) and USD64/bbl (vs. EIA’s USD62/bbl) for 2022. Our view reflects oil price trending lower HoH in 2H21, premised on increased output from OPEC+ and potentially the lifting of sanctions against Iran. Our key BUYs are Yinson, Dialog and Wah Seong for MY and PTTEP, PTTGC, and IVL for TH.