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OIL: Oil Selloff Large Relative to Fundamentals: Goldman

OIL

Goldman Sachs sees the latest oil price selloff as “large relative to the fundamental news” with room for financial demand to recover, according to Bloomberg.

  • The price decline was driven by a possible recovery in Libyan crude supply and as investors shed risk following poor economic data from the US and China.
  • Trend-following algorithmic trading known as CTAs likely amplified the move.
  • The bank sees risks to the downside from its $70-$85/bbl Brent range with stronger non-OPEC supply growth, especially from Canada.

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