2/2 © Reuters. A Saudi Aramco employee walks near an oil tank at the Ras Tanura refinery of Saudi Aramco, in a photo from Reuters archive 2/2
(September) – Commodity researcher Goldman Sachs (NYSE:) said Russia’s extension of voluntary supply cuts is pushing their price outlook higher and boosting the odds that Brent will jump to $107 a barrel next year.
On Tuesday, Saudi Arabia and Russia extended voluntary cuts until the end of 2023, pushing oil prices above $90 a barrel. Brent crude reached 90.97 by 1822 GMT.
The Saudi cuts amount to one million barrels per day, while the Russian cuts amount to 300,000 barrels per day. These cuts are in addition to others announced in April, with the agreement of many OPEC + producers, and will continue until the end of 2024.
In a note dated Tuesday, Goldman Sachs said that its first scenario includes that the absence of nearly 500,000 barrels per day compared to its own estimates of Saudi production in the fourth quarter means the possibility of prices rising by $2 a barrel from its December 2023 forecast of $86 a barrel.
In the second scenario, which includes the failure of nine OPEC + countries in January 2024 to cancel half of the production cuts of 1.7 million barrels per day announced in April, the price of Brent could reach $ 107 by December 2024.
The bank said the extension reflects OPEC+’s “decisive use of its extraordinarily high pricing power,” and also notes that OPEC+ is unlikely to be in a rush to increase production and that the potential sale of an additional stake in Saudi Aramco (TADAWUL:) may It stimulates Riyadh to use its pricing power.
(Prepared by Marwa Gharib for the Arabic Bulletin)
2023-09-06 22:48:00
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