Goldman Sachs had a forecast and is now even more bullish on oil. It is expecting Brent Crude prices to hit $75 a barrel in the third quarter this year. On the back of faster market rebalancing, the lower expectation on inventories and traders is still hedging against inflation.
The investment bank’s analysts forecast Brent Crude prices reaching the $70 a barrel mark. This is during the second quarter of this year. Moreoever, it is now and hitting $75 in the third quarter. With that, Goldman Sachs is thus lifting its previous Q2 and Q3 forecasts by $10 per barrel.
“Faster re-balancing during the dark days of winter will be followed by a widening deficit this spring as the ramp-up in OPEC+ production lags our above-consensus demand recovery forecast,” said Goldman Sachs.
“We further believe that this additional rally receives full support by the current repositioning for a reflationary environment with investors turning to oil, buying a lagging real asset that benefits from a stimulus-driven recovery and has demonstrated an unmatched ability to hedge against inflation shocks,” the analysts noted.
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Source: Oil Price
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