The price of a barrel of the crude oil benchmark grade West Texas Intermediate has fluctuated between $58 and $83 over the past year and is currently near the bottom of that range. Oil prices are down almost 50% from the $115-120 level touched back in 1H22, when Russia invaded Ukraine. For 2025, we are anticipating an average price of $66, up slightly from current levels but lower compared to $77 in 2024, $80 in 2023, and $95 in 2022. Our forecast trading range for the year is $55 to $75. The core drivers behind oil prices over the long term come from Econ 101: global supply and demand. According to the U.S. Energy Information Administration, there will be an excess supply of oil in 2025: global consumption is estimated at 104.1 million barrels per day, while global production is estimated at 104.4 million barrels. Early forecasts for 2026 also call for supply to exceed demand, which is likely to provide a ceiling to oil prices. Of course, there are always wild cards, such as geopolitical developments, ranging from tariffs (Canada), to wars (Russia's invasion of Ukraine), to sanctions (Iran, Venezuela), to the ongoing turmoil in the Middle East, to the whims of OPEC. The growth path of the Chinese economy also plays an outsized role in the direction of oil prices, and growth in India may some day have a greater impact than it does today. These wild cards can cause oil prices to fluctuate dramatically. That said, absent the wild cards, the global supply-demand outlook suggests the days of triple-digit oil prices are in the rear-view mirror, this as the world economy pivots toward cleaner energy solutions.

Stocks turn positive for the week on Thursday on trade talk optimism. President Trump announced that the U.S. and the UK have made an agreement on trade. Trade representatives from the U.S. and China are also slated to meet this weekend in Switzerland to work out trade terms. The Dow gained 254 points, or 0.6%. The S&P 500 rose 0.6%, and the Nasdaq advanced 1%.

Shell plc is an Anglo-Dutch multinational oil and gas company. The firm was created by the merger of Royal Dutch Petroleum and UK-based Shell Transport & Trading. It is the seventh-largest company in the world in terms of revenue and one of the six oil and gas 'supermajors'. The shares of Shell plc are not a component of the S&P 500 index and the company currently employs about 96,000 people.

Shell is an integrated oil and gas company that explores for, produces, and refines oil around the world. In 2023, it produced 1.5 million barrels of liquids and 7.3 billion cubic feet of natural gas per day. At end-2023, reserves stood at 9.6 billion barrels of oil equivalent, 49% of which, consisted of liquids. Its production and reserves are in Europe, Asia, Oceania, Africa, and North and South America. The company operates refineries with capacity of 1.6 mmb/d located in the Americas, Asia, Africa, and Europe and sells about 12 million tons per year of chemicals. Its largest chemical plants, often integrated with its local refineries, are in Central Europe, China, Singapore, and North America.