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Goldman Sachs sees less downside risk for oil prices on higher-than-expected stocks, noting that lower OECD trade stocks could add $2 to its forecast of $86 a barrel of Brent by the end of 2023.
OECD trading stocks, which according to Wall Street investment bank calculations equivalent to approximately one third of the more than 9 billion barrels of global stockswere 30 million barrels lower than expected in August.
The prices of brent oil They remained near 84 dollars a barrel on Wednesday, after reaching their highest level since January at the beginning of the month, thanks to a rise of more than 14 percent in July. [O/R]
“The main reason for the superior performance of oil is that oil market continues to take sizeable deficits for grantedGoldman analysts wrote in a research note on Tuesday, adding that the withdrawals tempered downside risk from what they previously called “persistently higher-than-expected inventories.”
According to Goldman, the Increased output at refineries has reduced crude stocks in the United States and Asia by 21 and 11 million barrels, respectively, since the end of June.
Coupled with the 50 million barrel drop in non-OECD reserves, led by China, and the 20 million barrel withdrawal from aquifer reserves, led by Saudi Arabia, world oil reserves have registered a decrease of 80 million barrels so far this month.
Another upside risk to prices from OPEC+ supply reduction has increased with “Saudi Arabia’s repeated commitment to cuts and their apparent willingness to broaden and even deepen them,” according to Goldman.
“Saudi production well could maintain its current low level of 9 million barrels per day (bpd) for longer if Saudi Arabia envisions a more aggressive price target.”
Goldman said news on demand in China was mixed and suggested that weak macroeconomic data was concentrated outside the services sectoroil-intensive, while international demand for aircraft continued to recover.
He also signaled a downside risk from increased Iranian supply, based on an estimated increase of 500 thousand bpd in exports Until the 20th of August.
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