Goldman Sachs Commodities Research said Saudi Arabia and Russia’s extension of voluntary supply cuts posed bullish risks to their crude price forecasts, raising a possibility that Brent could jump as high as $107 a barrel next year, according to a report in Reuters.
Saudi Arabia and Russia extended voluntary cuts to end-2023, pushing oil prices above $90 a barrel.
The Kremlin said on Wednesday Russian President Vladimir Putin had spoken by phone with Saudi Crown Prince Mohammed bin Salman, and that recent agreements on supply cuts had ensured stability on global energy markets.
“It was noted that the agreements reached on reducing oil production, combined with voluntary commitments to limit the supply of the commodity, make it possible to ensure the stability of the global energy market,” the Kremlin said in a readout of the call.
Per Reuters:
In a note dated Tuesday, Goldman Sachs Commodities Research said that in the first scenario, a roughly 500,000 barrel-per-day miss compared with its own estimates for Saudi output in the fourth quarter posed an estimated $2 per barrel upside risk to its December 2023 forecast of $86 a barrel.
In the second scenario, where nine of the OPEC+ – comprising the Organization of the Petroleum Exporting Countries (OPEC) and allies such as Russia – do not in January 2024 reverse half of their 1.7 million bpd output cuts announced in April, Brent could hit $107 a barrel by December 2024, Goldman said.
