Market surprise: loan volumes hit record highs, oil prices set to decline
Julius Baer analysts report that the leveraged buyout (LBO) sector is experiencing a significant surge, with 2026 potentially reaching unprecedented levels driven by direct financing. Meanwhile, global oil inventories remain stable, leading experts to forecast a decline in oil prices.
Economists at Julius Baer have released an economic review covering research on personalized nutrition, the market for direct loans in leveraged buyouts (LBOs), and the dynamics of strategic oil reserves.
Personalized Nutrition and Health
Damian Ng, Next Generation Research at Julius Baer, states: "Recent research highlights the growing importance of personalized healthcare. A review by the University of Wisconsin-Madison of over 350 studies found that lower protein intake may benefit metabolic health for those with sedentary lifestyles. Separately, a French study published in 'The Lancet Healthy Longevity' found no significant outcome differences for adults over 75 who stopped taking statins, emphasizing the need for tailored treatment plans."
Our healthy living index returned 0.4% over the past twelve months. We maintain a neutral view on this theme; while long-term growth drivers remain, current valuations appear generally consistent with future outlooks.
LBO Activity and Direct Lending
Cyril Demaria-Bangosha, Head of Private Markets Strategy and Research, comments: "Leveraged buyout activity has recovered from 2023 lows. First-half 2026 loan volumes were near $100 billion. If this trend continues, 2026 could match or exceed 2025 levels."
Since 2022, direct loans have accounted for over 40% of LBO financing volumes. This instrument has become a leading source due to its flexibility, speed, and confidentiality. We remain moderately positive on small and middle-market buyouts, which benefit significantly from the availability of direct lending.
Oil Market Outlook
Norbert Rucker, Head of Economics, notes: "Geopolitics in the Middle East is keeping oil prices elevated. However, global and US inventories are holding up better than feared, and strategic reserve releases are behind schedule. We maintain a cautious outlook, expecting oil prices to fall toward the $70 range this year and the $60 range next year."
The oil market remains gripped by the diplomatic stalemate between the US and Iran. Nevertheless, market pragmatism and stable flows through the Strait of Hormuz suggest that the supply shock will be moderate. Consequently, we maintain a short position on oil.
