Here’s What Goldman to UBS Are Saying About #Saudi-Led Oil Shock - Bloomberg

Here’s What Goldman to UBS Are Saying About Saudi-Led Oil Shock - Bloomberg

The surprise move by OPEC+ to maintain oil supply restrictions through April, coupled with Saudi Arabia’s decision to extend voluntary curbs, has stunned the global energy market. Prices surged again on Friday, with West Texas Intermediate topping $65 a barrel, and Brent climbing above $68.

Here’s what leading analysts make of the bold move.

Goldman: Brent Forecast Rises to $80 for Third Quarter

Goldman Sachs Group Inc. raised its second-quarter and third-quarter forecasts for Brent by $5 each to $75 and $80 a barrel, respectively. “Although members discussed Covid demand risks, our takeaway from the press conference is that the discipline of shale producers is likely behind this slower increase in production,” the bank said in a note. The outlook for OPEC+ production over the next six months was trimmed by 900,000 barrels a day.

JPMorgan: ‘Most Bullish Outcome We Could Have Expected’

JPMorgan Chase & Co. expects the OPEC+ decision to open a 1.8 million barrel-a-day deficit over the next three months on restrained supply and rising demand and it raised its Brent forecasts by $2 to $3 a barrel. The move was the “most bullish outcome we could have expected,” analysts including Natasha Kaneva wrote in a note. Saudi Arabia’s calculated bet is that U.S. tight oil will not add output beyond what the bank already expected, it said.

Citigroup: OPEC+ ‘Throws Reality to the Wind’

Oil’s rise will likely increase the strains within OPEC+ as some members will want to pump more to relieve under-pressure economies, Citigroup Inc. said in a report. Top importers including Asian giants China and India would also not be happy, and the alliance is likely to change course at its next meeting, it said. Prices could top $70 before the end of this month, the bank forecast.