Goldman Sachs predicts crude will hit $140 a barrel this summer
Goldman Sachs analysts expect global prices for crude to soar to $140 per barrel as soon as this summer, as a decline in Russian production, along with a gradual recovery in China’s demand, is expected to add to pressure on what are already low supplies.
“A large spike in prices remains quite possible this summer, when demand seasonally reaches its peak,” the bank’s analysts wrote in the note, seen by The Insider.
Goldman’s analysts expect prices to grow “given the current record low levels of inventories,” saying that Brent would average around $140 per barrel in the third quarter of 2022, and may go even higher.
The economists, however, highlighted that consumers will feel as though oil has hit $160 a barrel. This is due to a lack of capacity at refineries, which is expected to send prices for gasoline and fuel soaring more than previously thought, adding to costs across the economy.
Oil prices have skyrocketed nearly 50% so far this year as a result of a post-pandemic surge in demand for energy, and unprecedented Western sanctions imposed on Russia, one of the world’s biggest exporters.
According to data from the non-profit American Automobile Association (AAA), which tracks prices at more than 60,000 gas stations across the US, gasoline prices in the country have been pushed to a record high of $4.92 a gallon.
On Friday, international benchmark Brent crude was trading above $122 a barrel, while US crude benchmark WTI was over $121 a barrel.
Goldman analysts predict prices for crude will stay high, even though a surge to around $140 would trigger some “demand destruction” by encouraging people to stop using as much energy.
We use cookies on our website to give you the most relevant experience by remembering your preferences and repeat visits. By clicking “Accept”, you consent to the use of ALL the cookies.
This website uses cookies to improve your experience while you navigate through the website. Out of these, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may affect your browsing experience.
Necessary cookies are absolutely essential for the website to function properly. These cookies ensure basic functionalities and security features of the website, anonymously.
Cookie
Duration
Description
cookielawinfo-checkbox-analytics
11 months
This cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Analytics".
cookielawinfo-checkbox-functional
11 months
The cookie is set by GDPR cookie consent to record the user consent for the cookies in the category "Functional".
cookielawinfo-checkbox-necessary
11 months
This cookie is set by GDPR Cookie Consent plugin. The cookies is used to store the user consent for the cookies in the category "Necessary".
cookielawinfo-checkbox-others
11 months
This cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Other.
cookielawinfo-checkbox-performance
11 months
This cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Performance".
viewed_cookie_policy
11 months
The cookie is set by the GDPR Cookie Consent plugin and is used to store whether or not user has consented to the use of cookies. It does not store any personal data.
Functional cookies help to perform certain functionalities like sharing the content of the website on social media platforms, collect feedbacks, and other third-party features.
Performance cookies are used to understand and analyze the key performance indexes of the website which helps in delivering a better user experience for the visitors.
Analytical cookies are used to understand how visitors interact with the website. These cookies help provide information on metrics the number of visitors, bounce rate, traffic source, etc.
Advertisement cookies are used to provide visitors with relevant ads and marketing campaigns. These cookies track visitors across websites and collect information to provide customized ads.