Goldman raises oil price forecast for 2018 (4 Visits)
In a research note published late on Monday, Goldman outlined its forecast for both Brent and WTI for 2018. The original forecast had been sitting at $58 a barrel for Brent and $55 a barrel for WTI, and have now lifted to $62 and $57.50 USD.
Factors in these forecasts include the OPEC-led commitment to extend production cuts, although oil prices lost ground in the days following OPEC's deal with global producers last week. The research note said the OPEC-led deal leaves room for an earlier exit than currently scheduled, and a more modest exit rate. They also outline remaining risks.
Goldman said the response of shale oil and producers to higher prices may incentivize OPEC and Russia to pare back their capacity, leaving risks to prices long term. The collapse of oil in June 2014 was attributed to weak demand, a strong dollar, and booming U.S. shale production, but also OPEC's reluctance to cut output was a key reason for the fall.