Hana Securities "WTI Expected to Gradually Decline Between $55 and $70 per Barrel"

Hana Securities forecasted that West Texas Intermediate (WTI) crude oil, which has recently undergone a significant correction due to the US-originated tariff war, will show a gradual downward trend within a band of $55 to $70 per barrel in the future.

On the 18th, Jeon Gyu-yeon, a researcher at Hana Securities, stated in the report titled "The Fate of Oil Prices Amid the Whirlwind of Trade Disputes," "The US-China trade dispute is expected to prolong, and trade negotiations with other countries are periodically encountering difficulties, making a decline in trade volume inevitable this year," adding, "This inevitably acts as downward pressure on oil demand."

WTI, which was around $72 per barrel in the first quarter, plunged sharply in early April after the Trump administration in the US announced reciprocal tariffs, and currently remains in the low $60s per barrel. Researcher Jeon said, "The US-originated tariff war has intensified, causing a significant correction in international oil prices. This fully reflects the possibility of an economic slowdown," and added, "Major energy organizations such as the International Energy Agency (IEA) are rapidly revising down their oil demand forecasts considering the negative impact of trade disputes on the economy."

Additionally, the Organization of the Petroleum Exporting Countries Plus (OPEC+), composed of oil-producing countries, has shown cautious behavior following the sharp drop in oil prices, according to the researcher. He noted, "The additional supply from OPEC+ may not be as large as expected," and pointed out, "The US policy toward Iran is also being conducted in a two-way manner."

Researcher Jeon predicted, "Considering oil inventories and the break-even points (BEP) of shale companies, US oil production is also likely to be gradually adjusted," but added, "Since expectations for oil demand recovery are not high, the phase of oil oversupply will be maintained." He continued, "If US production is gradually adjusted and the pace of OPEC+ production increase is not faster than expected, the future decline in international oil prices is likely to proceed at a gradual pace," diagnosing, "WTI is expected to show a gentle downward trend within the band of $55 to $70 per barrel."

Meanwhile, on the 17th (local time) at the New York Mercantile Exchange, the near-month May delivery WTI price closed at $64.68 per barrel, up $2.21 (3.54%) from the previous session. The inclusion of Chinese refiners in US sanctions to pressure Iran sparked concerns over oil supply shortages, leading to the rise in oil prices that day. On the same day, the global benchmark Brent crude for June delivery rose $2.11 (3.20%) to $67.96 per barrel compared to the previous session.