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The current price of a barrel of the crude oil benchmark grade, West Texas Intermediate, has fallen below the $80 level, as we had expected. That's down from a high near $90 in April but still up 8% from the start of the year. We look for prices to stabilize at these levels for the next few quarters -- despite the onset of the summer driving season -- while global economic growth remains under pressure due to high interest rates. We now look for a barrel of West Texas Intermediate crude oil in 2024 to average $78, compared to last year's average price of $80, with a trading range of $95-$65 for 2024. For 2025, we look for oil prices to continue trending lower as initial forecasts call for a surplus of production next year. The core drivers behind oil prices in the long term are indeed global demand and global supply. According to the U.S. Energy Information Administration, there was modest excess demand in 2023: global consumption was 101.9 million barrels per day, while global production was 101.8 million barrels. Forecasts for the next two years now call for supply to exceed demand, which likely will keep a lid on potential oil-price spikes. Of course, there are always wild cards, such as geopolitical developments, ranging from wars (i.e., Russia's invasion of Ukraine), to sanctions (Iran, Venezuela), to the turmoil in the Middle East. The growth path of the Chinese economy also plays an outsize role in the direction of oil prices. These wild cards can cause prices to fluctuate dramatically. That said, absent the wild cards, the global demand-supply outlook suggests that the days of triple-digit oil prices are in the rear-view mirror as the world economy pivots toward cleaner energy solutions.

ExxonMobil is an integrated oil and gas company that explores for, produces, and refines oil around the world. In 2023, it produced 2.4 million barrels of liquids and 7.7 billion cubic feet of natural gas per day. At the end of 2023, reserves were 16.9 billion barrels of oil equivalent, 66% of which were liquids. The company is one the world's largest refiners with a total global refining capacity of 4.5 million barrels of oil per day and is one of the world's largest manufacturers of commodity and specialty chemicals.

ExxonMobil is an integrated oil and gas company that explores for, produces, and refines oil around the world. In 2023, it produced 2.4 million barrels of liquids and 7.7 billion cubic feet of natural gas per day. At the end of 2023, reserves were 16.9 billion barrels of oil equivalent, 66% of which were liquids. The company is one the world's largest refiners with a total global refining capacity of 4.5 million barrels of oil per day and is one of the world's largest manufacturers of commodity and specialty chemicals.

Petrobras is a Brazil-based integrated energy company controlled by the Brazilian government. The company focuses on exploration and production of oil and gas in Brazilian offshore fields. Production in 2023 was 2.8 million barrels of oil equivalent a day (80% oil production), and reserves stood at 10.9 billion boe (85% oil). At end-2023, Petrobras operated 10 refineries in Brazil with capacity of 1.8 million barrels a day and distributes refined products and natural gas throughout Brazil.