A Goldman Sachs (GS) Commodities Research report expects that crude oil prices still have more room on the downside. The report highlighted that non-OPEC production will continue to grow a little faster than demand for the next few quarters, and that oil prices are likely to remain below $80 per barrel until 2016, reported Value Walk website.
This is alarming for several countries including Libya, which GS anticipates needs $185 crude oil to breakeven.
GS analysts pointed out that “Our 2016 and long-term forecasts are now $80/bbl WTI, $90/bbl Brent. Uncertainty around the required price to slow down US shale production growth is a key risk to our price forecast.”
The analysts added that they now have “higher confidence that a structural transition has been reached and that US production growth needs to slow.” Therefore, their prediction also considers a loss of pricing power by core-OPEC, according to the Website.
This is alarming for several countries including Libya, which GS anticipates needs $185 crude oil to breakeven.
GS analysts pointed out that “Our 2016 and long-term forecasts are now $80/bbl WTI, $90/bbl Brent. Uncertainty around the required price to slow down US shale production growth is a key risk to our price forecast.”
The analysts added that they now have “higher confidence that a structural transition has been reached and that US production growth needs to slow.” Therefore, their prediction also considers a loss of pricing power by core-OPEC, according to the Website.
Source:
Mubasher
