Morgan Stanley Comments on Crude Oil (USO) (BNO)

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Analysts at Morgan Stanley said they are far less bearish today on crude oil than we have been all year. Analysts were referring to 2013 prices, and while not exactly a ringing endorsement the comments can be viewed as positive for further upside in the commodity.

Since July 1st United States Oil ETF (NYSE: USO), which is tied to the price of WTI futures, has gained 13.5 percent. United States Brent Oil ETF (NYSE: BNO) has gained 19 percent over the same period.

The rally in the crude is tied in part to non-OPEC production which “has disappointed”, and the recent round of strikes in Norway hasn’t helped, noted the report.

Analyst also said they believe the premium on Brent oil to West Texas Intermediate is unlikely to widen from today’s levels and may narrow.

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Morgan Stanley, Crude Oil, OPEC

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