From Bloomberg
Oil’s climb above $45 a barrel is reassuring influential figures from BP Plc to the International Energy Agency that the industry is finally recovering from the worst slump in a generation. Others say the market is about to fall into the same trap as last year.
There’s a sense of deja vu at Commerzbank AG, BNP Paribas SA and UBS Group AG, who say crude’s gain of about 70 percent from a 12-year low in January resembles the recovery that took hold this time last year — only to sputter out by May as the supply glut endured. Prices will sink back towards $30 a barrel in the coming weeks, BNP and UBS warn.
“There are dangerous parallels to 2015,” said Eugen Weinberg, head of commodities research at Commerzbank in Frankfurt. “The market already appears overheated and a correction is overdue.”
Gathering Pace
The price increase has been reinforced by unplanned disruptions in producers such as Nigeria, Iraq and Kuwait. Even the failure of talks between OPEC and other major producers in Doha to freeze production couldn’t dent this month’s rally, which for Brent is on track to be the biggest in almost seven years.
As the recovery gathered pace, the conviction has grown that the worst is over.
