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(Reuters) – Goldman Sachs has increased its crude oil price forecast this year, as supply has been affected by the "shocking and shocking" implementation of OPEC-led production cuts and price cuts. US sanctions against Iran and Venezuela.
PHOTO FILE: An oil tanker is being loaded at the Ras Tanura oil refinery and oil terminal in Saudi Aramco, Saudi Arabia, on May 21, 2018. Photo taken on May 21, 2018. REUTERS / Ahmed Jadallah / File Photo
In a note dated April 8, the investment bank said it now expects Brent crude benchmark prices to average $ 66 per barrel in 2019, up from $ 62.50 previously.
US crude oil averages $ 59.50 per barrel, up from its latest forecast of $ 55.50.
Oil prices reached their highest level in five months on Tuesday, with Brent at $ 71.34 per barrel and US crude at $ 64.77 per barrel. [O/R]
Crude markets tightened this year as the United States imposed sanctions on oil exporters, Iran and Venezuela, while the OPEC producer club retained supplies to drive up prices.
Goldman added that he expected the Brent forward curve to move more in terms of backward compatibility, a situation in which future delivery contracts are cheaper than cash supplies. The regression indicates a tighter market.
This comes as Goldman expects the global oil market to remain in an supply deficit of about 0.5 million barrels a day in the second quarter.
The bank now sees the price of Brent at $ 72.50 per barrel in the second quarter, up from $ 65 a barrel. But he has maintained his Brent oil price forecast for 2020 at $ 60 a barrel.
"While the macroeconomic environment and the threat of disruption are likely to drive up spot prices, we still expect a gradual decline in prices starting this summer with the increase in production of shale and OPEC, "Goldman said.
The way OPEC manages its exit from current supply cuts will have a decisive influence on oil prices in the months and years to come, Goldman said.
Report of Swati Verma in Bengaluru; Edited by Joseph Radford
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