Goldman Sachs: Oil Price Forecast Lowered, but Oversupply Likely to Ease

12 Sept - On Friday, Goldman Sachs slashed its oil price forecast for 2016 from $62/bbl to $49.5/bbl for the international benchmark Brent crude oil and from $57/bbl to $45/bbl for WTI crude, allowing for a short-term price decline to 20 US$/bbl. The sharp revision has attracted considerable media attention, however, Goldman's outlook for 2017 remained unchanged.

According to Goldman Sachs Commodities Research, oil market oversupply has already peaked in Q2 2015 and will gradually decline in the coming months to reach a deficit of 305,000 b/d by the end of 2016.

Sources: GS Oil Supply And Demand Estimates And Price Forecasts, September 2015, IMF Commodity Price Forecasts, July 2015, EIU Economic and Commodity Forecast, July 2015, World Bank Commodity Forecast Price data, July 2015, IEA Oil Market Report, 2016, Oil Supply and Demand: OPEC Estimates And Projections, August 2015