Oil Prices Will Ultimately Need to Go Higher, Says Morgan Stanley’s Rats

The video discusses the current state of oil prices, influenced by OPEC's production decisions and global demand trends. It highlights supply risks in countries like Iran and Venezuela, and demand weaknesses, particularly in the OECD. The second half of the year typically sees increased demand, but electric vehicles pose a long-term threat to oil demand. However, this threat is not immediate, and oil companies must consider it in their long-term investment strategies.

What are the main factors currently holding the oil price at $70 per barrel?

• Supply risks in certain countries and demand weakness

• Increased production in Iran and Venezuela

• OPEC's production cuts and increased demand

• High demand in OECD countries

What is expected to happen to oil demand in the second half of the year?

• It will remain stable

• It will accelerate by about a million barrels a day

• It will decline due to increased electric vehicle usage

• It will decrease due to lower transportation needs

Which countries are mentioned as potential contributors to stronger oil demand through fiscal stimulus?

• China and India

• Brazil and Argentina

• United States and Canada

• Germany and France

How significant is the impact of electric vehicles on oil demand in the near term?

• Very significant, reducing demand by millions of barrels

• Moderately significant, with a noticeable impact

• Not significant enough to affect near-term oil prices

• Completely insignificant

How might the threat of electric vehicles influence oil companies' investment strategies?

• It will cause companies to abandon oil investments entirely

• It will have no impact on investment strategies

• It will lead to increased investment in oil production

• It might constrain capital expenditure and lead to short-term market tightness