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By Irina Slav - Oct 07, 2022, 2:30 AM CDT
Goldman Sachs raised its 2022 price forecast for Brent crude from $99 to $104 per barrel. The increase was driven by the OPEC+ decision to reduce output by 2 million bpd. Although the 2-million-barrel figure is nominal and the actual output cut would be smaller, at around half that, the bank believes the physical oil market is tight enough to justify such price forecast updates. On a quarterly basis, Goldman sees Brent trading at $110 this quarter and rising to $115 per barrel in the first quarter of 2023. In arguably the most bullish part of Goldman’s update, the bank said that there could be a $25 upside to their Brent forecast if OPEC+ maintains its output reduction through to 2023. Yesterday, Morgan Stanley also raised its price forecast for Brent crude, to $100 for the first quarter of 2023. According to Goldman’s latest forecast, the average for Brent next year could be $110 per barrel as a result of the cuts. The bank’s analysts commented that such a deep cut would prompt a response from the United States and that this response would most likely be a further release of strategic reserve crude. According to Goldman, even the International Energy Agency might join the reserve release to keep a lid on oil prices. Some media commentators have criticized the reduction of physical supply of oil at a time when most big consumers are struggling with inflation and an already short supply of energy. Bloomberg’s Javier Blas suggested it was a mistake. The OPEC+ camp, on the other hand, motivated the move with market circumstances, with Saudi energy minister Abdulaziz bin Salman saying he did not want to gamble with the market. The remark likely refers to recession expectations that caused oil prices to decline by about a quarter between July and September. "The oil market's buffers (stocks and spare capacity) remain critically low, and higher prices remain the key viable, long-term solution to increased inventories in the short term and higher supply capacity medium term," Goldman analysts said. While oil prices had cooled off slightly early on Friday morning, they were still set for the largest weekly gain since Spring. By Irina Slav for Oilprice.com More Top Reads From Oilprice.com:
Join the discussion | Back to homepage Irina SlavIrina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry. More Info Related postsLeave a comment Oct 6 (Reuters) - Goldman Sachs has raised its oil price forecast for this year and 2023, as the U.S. bank expects the 2 million barrels per day (bpd) output cut agreed by OPEC+ producers to be "very bullish" for prices going forward. OPEC+, which groups members of the Organization of Petroleum Exporting Countries and allies including Russia, agreed its deepest cuts to production since the 2020 COVID pandemic at a meeting in Vienna on Wednesday. If latest reduction in output by OPEC+ is sustained through December 2023, it would amount to $25 per barrel upside to their Brent forecast, with potential for price spikes even higher should inventories fully deplete, Goldman Sachs said in a note dated Wednesday. Register now for FREE unlimited access to Reuters.comGoldman Sachs raised its 2022 Brent price forecast to $104 per barrel from $99 per barrel and 2023 forecast to $110 per barrel from $108 per barrel. The U.S. bank also raised its fourth quarter 2022 and first-quarter 2023 Brent price forecast by $10 per barrel to $110 and $115 per barrel, respectively. Benchmark Brent crude was trading around $94 per barrel on Thursday, after gaining 1.7% in the previous session. Such a large OPEC+ effective cut will likely warrant another response from the U.S. administration, and even a coordinated International Energy Agency SPR release, the bank noted. "The oil market's buffers (stocks and spare capacity) remain critically low, and higher prices remain the key viable, long-term solution to increased inventories in the short term and higher supply capacity medium term," Goldman added. Morgan Stanley on Wednesday also raised its oil price forecast for the first quarter of 2023, predicting tight supply going forward. Register now for FREE unlimited access to Reuters.comReporting by Brijesh Patel in Bengaluru; editing by David Evans Our Standards: The Thomson Reuters Trust Principles. Will Brent oil go up or down?Brent crude oil price forecast: 2022 to 2023
It expected global oil consumption growth to continue declining over the next two years. ANZ Research projected the Brent crude oil price to average $113.80 in 2022 and $104.50 in 2023.
What is the forecast for crude oil prices?The investment bank has raised its price forecasts by $10 a barrel and sees Brent crude ending 2022 at $110 a barrel, rising to $115 a barrel in the first quarter of 2023.
Will oil go up or down in 2022?Oil prices are currently trading around $95 per barrel for Brent crude, and just below $89 a barrel for the U.S. West Texas Intermediate. Analysts told CNBC they expect oil prices to hold steady through the second half of 2022, though they said the potential impact of an economic recession has not yet been priced in.
What will the price of crude oil be in 2022?Goldman Sachs raised its 2022 Brent price forecast to $104 per barrel from $99 per barrel and 2023 forecast to $110 per barrel from $108 per barrel.
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Brent crude oil price forecast for next week
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