January 11, 2023 08:35 GMT
Goldman Expects OPEC Sway to Limit Oil Downside 2023
The growing ability of OPEC to raise prices without hurting demand too much will limit downside risks for oil forecasts in 2023 according to Goldman Sachs.
- The bank sees global oil demand growth of 2.7 million barrels per day in 2023, pushing the market into deficit in the second half of the year and pushing Brent to $105/bbl by q4.
- "This tightening, in turn, should allow OPEC to start unwinding its October production cut in H2," Goldman said in an analyst note.
- "However, if the market turned out to be softer, then OPEC could stick to its October cuts or cut production even further given its significant pricing power," the note added.
- It said that OPEC’s pricing power has grown "unusually high" in recent years.