Lipow Oil Associates President Andy Lipow talks about his prospects for Texas after the deep freeze and related power outages.
Oil prices will rise faster and more sharply than previously expected, as demand outstrips supply increases from OPEC +, Iran and U.S. shale, according to Goldman Sachs Group Inc.
The reopening of the global economy will help demand return to pre-COVID-19 levels, but stocks that remain tight in the summer will cause US standard West Texas Intermediate crude to reach $ 67.50 a barrel in the second quarter and $ 72 in the next three months, according to Goldman. The company previously predicted that WTI would reach $ 62 this summer.
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Goldman said Brent crude, the international standard, will hit $ 75 this summer, up from its previous $ 65 forecast.
“This year continues to be driven by fundamentals, with better-than-expected demand and still-reduced supply, again creating a larger deficit than we expected,” wrote Damien Courvalin, head of energy research at Goldman Sachs.
The company expects the deficit to widen this spring, as production by OPEC and its allies, including Russia, takes longer to return despite an increase in prices.
Higher costs related to ESG and environmental regulation and investor hedging due to fears that additional COVID-19 stimulus will cause inflation to help raise prices.
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WTI crude oil exceeded $ 62 a barrel on Wednesday and was trading just below that level – close to $ 61 – on Monday.
Oil prices in the United States plunged to a record low of – $ 36.73 a barrel last April, with blockages designed to slow the spread of COVID-19 and a price war between Saudi Arabia and Russia, causing an increase in inventories.