Important Links

Top 5 Signposts to Watch for in Oil Markets

16 January 2018Commodities

With oil prices at a three-year high, Citi analysts highlight 5 top signposts that investors may want to keep an eye on. Citi's view is that oil prices may weaken into 2H18 as producer cuts come to an end.

  1. The level of oil supply disruptions: The risk is likely skewed to the upside for global oil supply disruptions given that OPEC's Iran, Iraq, Libya, Nigeria, and Venezuela pose a high short-term oil supply risk.
  2. Chinese crude buying: Citi analysts estimate that Chinese crude imports could remain strong and grow by 0.4-0.5-m b/d y/y in 1H18,
  3. Global Manufacturing PMIs: Citi's industry weighted average of global PMIs is at its highest level since 1H11 and if the strength in manufacturing PMIs persists then this is likely to remain supportive for crude markets.
  4. US oil rig count and US crude production: Higher US oil rig count could trigger investor outflows, as it has done previously, and this is expected in the next month. Citi analysts also expect US crude production to grow at ~1-m b/d y/y in 2018.
  5. Oil output cut extension deal: In November 2017, OPEC and Russia agreed to extend oil output cuts until December 2018 but all eyes will be on the June review which could result in early termination of the deal.

On the potentially bullish side is the upside risk of supply disruptions, strong Chinese crude buying and stronger macroeconomic data that are supporting global asset prices and keeping sentiment bullish. On the bearish side is growing US crude production and rig counts, as well as potentially higher OPEC crude exports. Taking all that into consideration, Citi analysts think that oil prices could weaken into 2H18.

Our recent research

A Pandemic Pause Amidst the Recovery?

As individual States in the US emerge from the first-order effect of lockdowns, the result has been a uniform, major jump in economic activity, but an acceleration in the spread of the virus across half the country. Citi analysts expect financial market volatility to remain high. However, improving financial conditions, supportive macroeconomic policies, improving sentiment by consumers and business suggest that the new economic recovery could endure.

Find out more

Covid-19Asset AllocationEquities

Equity Strategies to Position for China's Aging Population

Population aging is often presented as a crisis for China. Instead, Citi analysts see immense opportunities amid the challenges.

Find out more

Asia PacEmerging MarketsEquities

Brexit negotiations in the limelight

The UK has 'left' the European Union, but with less than 200 days until the end of the one-year transition period, what happens next?

Watch a replay of our webinar where we discuss the likely path of the negotiations and the impact to the markets.

Find out more


Take the first steps to your wealth management planning with Citi

Speak to a Relationship Manager
0207 500 1992

Already with Citi? Contact your relationship manager or view product availability on Citi Online

Why choose Citi

A relationship - not just a bank account

A dedicated Relationship Manager giving you access to our internal team of product experts and all our benefits

Access to exclusive Citi products

A range of current and investment products available both on shore and offshore, in the currency of your choice
Multi-currency accounts
Investment products

Global services for a global lifestyle

Our team is here to support you getting started in UK or with International travel and relocation
Moving to and from the UK
Travelling overseas

Offshore investments

We offer a diverse range of banking and investment services, including for those who want access to offshore investments

Find out more

Just moved to the UK?

We can save you time money and hassle. If you are a foreign national in the UK, Citi's International Banking Service can help you manage your money, home and away.

Find out more

Investment products are not insured by any governmental agencies, are not bank deposits, and are neither obligations of, nor guaranteed by, Citigroup, or any of its affiliates, unless otherwise stated. Investment products are subject to investment risks, including possible loss of some or all of the principal amount invested. Past performance is not indicative of future results, investments can go down as well as up.

“Citi analysts” refers to investment professionals within Citi Research (“CR”), Citi Global Markets Inc. (“CGMI”) and voting members of the Citi Global Investment Committee. Citibank N.A. and its affiliates / subsidiaries provide no independent research or analysis in the substance or preparation of this document. The information on this page has been obtained from reports issued by CGMI. Such information is based on sources CGMI believes to be reliable. CGMI, however, does not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute CGMI’s judgment as of the date of this page and are subject to change without notice. This page is for general information purposes only and is not intended as a recommendation or an offer or solicitation for the purchase or sale of any security or currency. No part of this page may be reproduced in any manner without the written consent of Citibank N.A. Information on this page has been prepared without taking account of the objectives, financial situation, or needs of any particular investor. Any person considering an investment should consider the appropriateness of the investment having regard to their objectives, financial situation, or needs, and should seek independent advice on the suitability or otherwise of a particular investment. Citi Research (CR) is a division of Citigroup Global Markets Inc. (the "Firm"), which does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this information. Investors should consider this information as only a single factor in making their investment decision.

Opinions expressed herein may differ from the opinions expressed by other businesses or affiliates of Citigroup, Inc., and are not intended to be a forecast of future events, a guarantee of future results or investment advice, and are subject to change based on market and other conditions.