
Amid escalating geopolitical tensions and uncertainty over global demand, the energy sector has witnessed notable turbulence in recent months. However, crude futures for April delivery (CLJ24) rallied 3.8% this week, hitting new 2024 highs after an IEA report highlighted rising demand and potential supply deficits in 2024 due to OPEC+ cuts, Ukrainian drone attacks on Russian refineries, Red Sea ship incidents, and expectations of Federal Reserve rate cuts, which have historically bolstered demand.
Perhaps even more compelling for energy investors this month is the news that Brazilian state-run oil company Petroleo Brasileiro S.A. (PBR) came up short on 2023 dividends. This news spilled beyond Petrobras, causing a significant downturn in the broader Brazilian stock market, as the oil major accounts for 13% of the benchmark Ibovespa index.