Oil: Crude forecasts signal inflation surprises ahead - Societe Generale
Societe Generale’s analysts use their Brent, West Texas Intermediate (WTI) and Diesel price forecasts to derive forward-looking inflation surprises for the US and Eurozone.
Societe Generale analysts utilize their forecasts for Brent, West Texas Intermediate (WTI) and Diesel prices to predict forward-looking inflation surprises in the United States and the Eurozone. By analyzing spreads, inventories, and refining cracks, they create 12-month projections for crude oil and Diesel. If these forecasts prove accurate, they suggest that Consumer Price Index (CPI) surprises can be anticipated ahead of official releases using a focus on energy.
Given that most inflation surprises are largely attributable to shifts in oil prices, the analysts can derive a forecast for inflation surprises based on their own oil price outlook.
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