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Company Reports

07 October 2024

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Oil Weekly (07 October 2024): USD 75.0/bbl (+2.4% WoW)

Recent Catalysts Driving the Price

  • In 30 Sep – 04 Oct 2024, Brent prices rose +2.4% WoW (from USD 73.2/bbl), while WTI prices increased +2.5% WoW (from USD 69.5/bbl). On 3 October, oil prices spiked caused by escalating geopolitical tensions in the Middle East.
  • The oil market is on an upward trajectory due to escalating concerns over Israel’s potential retaliation against Iran, which threatens critical shipping routes like the Strait of Hormuz. Any disruption to this vital passage, responsible for a significant share of global oil flow, could result in sharp price spikes. Furthermore, OPEC+ extended its 2.2 mmbopd cut until Dec-24 and the 1.66 mmbopd cut until the end of 2025.
  • We maintain our average oil forecast at USD 79/bbl (avg YTD: USD 81.3/bbl) due to sustained price pressure, though some upside persists from potential production cuts in 4Q24 and 2025. At this stage, we retain MEDC as our top pick, with target price of IDR 2,200, reflecting FY24F valuation of 4.9x EV/EBITDA.

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