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Goldman Sachs reduced its outlook for oil prices this year citing abundant supply, Bloomberg reports, quoting a note to clients.
The investment bank’s analysts now expect Brent crude to average US$62.50 a barrel this year, down from an earlier projection of US$70 a barrel. West Texas Intermediate, according to Goldman Sachs, will average US$55.50 a barrel, compared with an earlier estimate of US$64.50 a barrel.
Price - Outlook - Revision - Expectations - Glut
The price outlook revision was motivated by expectations of another glut despite the OPEC+ production cuts aimed at removing 1.2 million bpd from the global market and continued growth in U.S. shale oil production, as well as higher output in Brazil and Canada.
The bank’s analysts said, with regard to their expectations of oversupply, that OPEC produced a lot more crude oil in the last months of 2018, which means the cartel begins 2019 with more total production than it had at the beginning of last year, when larger production cuts were...
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