Crude market potentially vulnerable

Crude oil markets are vulnerable to a reversal of the bullish sentiment that has prevailed since the third quarter of 2010. We believe that in the coming months supply fears could well dissipate, while evidence of the impact of historically high prices on world economic activity grows. Rather than supply deficits in 2011/12, a swing to surplus is looking a possibility. Prices for benchmark light crudes are potentially vulnerable by $30/barrel over the next six months.

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