Goldman Sachs Expects Oil to Reach $ 80 a Barrel

Goldman Sachs signed that oil prices rise to $80 a barrel in the fourth quarter of this year, explaining that the market has not improved the estimate of recovery in demand, even despite the possible resumption of Iranian crude supplies.

“The case for higher oil prices, therefore, remains intact given the large vaccine-driven increase in demand in the face of inelastic supply,” the bank said in a note dated Sunday.

Added that the assumption of a return to Iranian exports in July did not preclude that Brent prices were still on track to reach $ 80 by the fourth quarter.

Oil prices plummeted last week after Iranian President Hassan Rouhani said the United States was ready to lift sanctions on his country’s oil, banking and shipping sectors.

But crude compensated for some of those losses today, Monday, as a potential obstacle appeared in efforts to revive the Iran nuclear deal signed in 2015, which efforts could add to oil supplies. Talks between Washington and Tehran are due to resume this week.

Goldman Sachs said that the recovery in demand in developed markets will offset the impact of the recent blow to consumption due to the pandemic, and the possible slowdown in the recovery that followed in South Asia and Latin America.

“Mobility is rapidly increasing in the U.S. and Europe, as vaccinations accelerate and lockdowns are lifted, with freight and industrial activity also surging,” the note said.

The bank expected that demand will increase by 4.6 million barrels per day until the end of the year, indicating that most of the increase is likely in the next three months.