English
Market News Goldman Sachs raises oil price target again
Goldman Sachs raises oil price target again
Late Monday, Goldman Sachs issued a report that again raised its crude oil price forecast, saying structural shortages remain unresolved, and raised its summer peak oil price target from $125 to $140, while also raising its 2022 oil price target. The oil price target for the remainder of the year and for 2022 was raised by $10.
2022-06-08
9665
Later on June 7, Goldman raised its peak summer oil price target to $140 from $125, while also raising its oil price target for the remainder of 2022 and 2022 by $10. A recovery in Asian demand and a potential drop in Russian production could push oil prices further. Goldman Sachs believes that the global oil market is still in a structural deficit and that a sharp increase in oil prices is needed to restore balance.
Damien Courvalin, head of commodities at Goldman Sachs Energy Research, pointed to a brief oil balance in Asia earlier this year as several cities were locked down, a relatively small drop in Russian exports and a record strategic oil reserve. Decline.
However, the analyst also noted in a note that demand in Asia has begun to recover after a brief balancing period, which is over. On the other hand, Russian oil production could fall by another 500,000 barrels per day, according to Kurvarin.
According to the report’s authors, Brent would need to average $135 a barrel for the 12 months starting in July before global crude inventories return to normal levels by the end of 2023.
As a result, the global oil market remains in a structural deficit, requiring sharply higher oil prices to restore balance, Goldman Sachs said.
The extent of this structural shortage was already evident last week when oil prices rose instead of falling as OPEC+ decided to increase output on top of a monthly increase of more than 200,000 barrels.
One reason for this market reaction is that very few OPEC members actually have excess capacity to increase production beyond current production, with several large members struggling to meet current quotas, let alone raise them.
Another reason is that despite the rise in crude prices, demand does appear to remain strong, which, as Goldman's Culvarin pointed out, suggests that prices need to continue to rise before they can start to have a material impact on demand.
(Daily chart of Brent crude oil main contract)
GMT+8 At 10:19 on June 8, the price of the main Brent crude oil contract was reported at $120.73 per barrel.
Damien Courvalin, head of commodities at Goldman Sachs Energy Research, pointed to a brief oil balance in Asia earlier this year as several cities were locked down, a relatively small drop in Russian exports and a record strategic oil reserve. Decline.
However, the analyst also noted in a note that demand in Asia has begun to recover after a brief balancing period, which is over. On the other hand, Russian oil production could fall by another 500,000 barrels per day, according to Kurvarin.
According to the report’s authors, Brent would need to average $135 a barrel for the 12 months starting in July before global crude inventories return to normal levels by the end of 2023.
As a result, the global oil market remains in a structural deficit, requiring sharply higher oil prices to restore balance, Goldman Sachs said.
The extent of this structural shortage was already evident last week when oil prices rose instead of falling as OPEC+ decided to increase output on top of a monthly increase of more than 200,000 barrels.
One reason for this market reaction is that very few OPEC members actually have excess capacity to increase production beyond current production, with several large members struggling to meet current quotas, let alone raise them.
Another reason is that despite the rise in crude prices, demand does appear to remain strong, which, as Goldman's Culvarin pointed out, suggests that prices need to continue to rise before they can start to have a material impact on demand.
(Daily chart of Brent crude oil main contract)
GMT+8 At 10:19 on June 8, the price of the main Brent crude oil contract was reported at $120.73 per barrel.
Bonus rebate to help investors grow in the trading world!
Or try Free Demo Trading
