Goldman Drops Oil Forecasts Despite Prior Bullish Stance

Goldman Sachs has dropped its oil price forecast by nearly 10% from $95/bbl for Brent by December to $86/bbl.

• In the same report, Goldman revised down its WTI forecast for December from $89/bbl to $81/bbl.
• The revision comes despite last week’s announcement by Saudi for an extra 1mn bpd cuts as part of its OPEC+ commitments effective July.
• Goldman has revised its forecast lower on increasing global supply and slower demand for crude.
• “Significant supply beats from Iran and Russia have driven speculative positioning to near record-lows,” Goldman said.
• “After an initial sharp 1.5 million barrels per day drop, Russian supply has nearly fully recovered despite the decision by many companies to stop buying Russian barrels,” Goldman added.
• The bank made upward revisions for oil supply forecasts coming from nations facing sanctions, with “2024 upgrades for Russia, Iran, and Venezuela of 0.4/0.35/0.05 mb/d, respectively.”