On Monday, oil prices advanced after Goldman Sachs projected that soaring summer demand would lead to a significant supply shortage.
The US West Texas Intermediate (WTI) July crude futures surged by 3.16% to $77.74 per barrel on June 10. Furthermore, industry watchers anticipate a 0.15% increase to $77.86 in the coming trading day.
Similarly, Brent oil futures for July delivery jumped by 2.52% to $81.63 a barrel, recovering from Wednesday’s 0.31% drop. Moreover, commodity specialists expect a 0.06% gain to $81.67 in the coming market session.
As summer approaches, analysts predict demand will expand by up to 2.50 million barrels per day (bpd) through August. Hence, they estimate a rapid depletion of the stockpile that crude monitoring bodies reported for the third week of May.
Energy Information Administration crude oil stock increased by 1.23 million barrels in the week ending May 31. This reversed the expected reduction of 2.10 million barrels and followed the shortfall of 4.16 million barrels a week earlier.
During the same week, the American Petroleum Institute reported a build of 4.05 million barrels in black gold inventories. The reading contradicted the 1.90-million-barrel estimated draw, trailing the deficit of 6.49 million barrels in the week ending May 24.
Goldman Sachs Sees Brent Oil Soaring This Year
According to Goldman Sachs, the London oil benchmark will breach the $86.00 resistance level in the third quarter. The global investment banking and management firm added that Brent may rise by 4.65% in Q4 to settle at $90.00.
Additionally, the New York-headquartered company specified summer travel and cooling consumption as the two primary drivers. As a result, it predicts a sizeable global deficit of 1.30 million bpd throughout the season.
Lastly, Goldman Sachs said demand growth will prevent oversupply despite OPEC+ easing a portion of its output reductions after September. The bloc announced it will phase out 2.20 million bpd of 5.86 million bpd oil output cuts over 12 months starting October.
