• 6 minutes Corporations Are Buying More Renewables Than Ever
  • 17 minutes WTI @ 67.50, charts show $62.50 next
  • 23 minutes Starvation, horror in Venezuela
  • 21 hours Permian already crested the productivity bell curve - downward now to Tier 2 geological locations
  • 1 day Desperate Call or... Erdogan Says Turkey Will Boycott U.S. Electronics
  • 19 hours Renewable Energy Could "Effectively Be Free" by 2030
  • 20 hours Saudi Fund Wants to Take Tesla Private?
  • 1 day Mike Shellman's musings on "Cartoon of the Week"
  • 2 days Venezuela set to raise gasoline prices to international levels.
  • 2 days The Discount Airline Model Is Coming for Europe’s Railways
  • 1 day Pakistan: "Heart" Of Terrorism and Global Threat
  • 1 day Are Trump's steel tariffs working? Seems they are!
  • 2 days Scottish Battery ‘Breakthrough’ Could Charge Electric Cars In Seconds
  • 2 hours Hey Oil Bulls - How Long Till Increasing Oil Prices and Strengthening Dollar Start Killing Demand in Developing Countries?
  • 13 hours Why hydrogen economics does not work
  • 12 hours China goes against US natural gas
Alt Text

Why Is Big Oil So Excited About Alaskan Crude?

Alaskan officials have just published…

Alt Text

Is This Europe’s Newest Oil & Gas Producer?

Portugal has a troubled oil…

Tsvetana Paraskova

Tsvetana Paraskova

Tsvetana is a writer for the U.S.-based Divergente LLC consulting firm with over a decade of experience writing for news outlets such as iNVEZZ and…

More Info

Trending Discussions

Goldman Sachs: Oil Market To Rebalance By Early 2018

cushing oil farm

Recent data show that the rebalancing of the oil market is speeding up and if the drawdown trends are sustained, stockpiles will normalize by early 2018, Goldman Sachs said on Thursday, adding that it was “cautiously optimistic” on oil prices.

“While OPEC’s production path remains uncertain, recent fundamental oil data have come in even better than we had expected,” Goldman said in a note, as quoted by CNBC.

“If sustained, these trends would help achieve the normalization in inventories by early next year,” the investment bank added.

Over the past month, oil prices have rebounded thanks to robust demand, strong draws in U.S. inventories, and drops in U.S. rig counts, Goldman said. Oil prices have risen above the investment bank’s price projection for September 2017 of US$50 per barrel of Brent, Goldman Sachs said.

The EIA reported this week another hefty decline in U.S. commercial crude oil inventories for the week ending July 21. The EIA said crude oil inventories diminished by 7.2 million barrels, to 483.4 million barrels. The EIA had reported strong inventory draws in the last three weeks as well. Meanwhile, the number of active oil rigs in the United States fell last week by 1 rig —its second loss in four weeks.

According to Goldman estimates, data from the U.S., Europe, Japan, and Singapore point to a total inventory drop of 83 million barrels since March. In addition, demand in the U.S., India, and China is strong, and Goldman expects it to stay strong through the end of this year, leading to sustained draws in the third quarter. Related: Oil Rises, But Saudis Face Daunting Dilemma

According to Goldman, this would tighten the physical oil market and flip the market structure to backwardation this year.

However, the bank is still “cautious” on prices because the inventory decline needs to show it will be sustained.

Earlier this month, Goldman Sachs said that oil prices could soon fall below US$40 if there wasn’t a sustained drawdown in U.S. crude inventories and rig counts, or without any bold “shock and awe” action from OPEC. The oil market is searching for a new equilibrium, Goldman said back then, adding that it was still too early to tell whether the most recent inventory reductions in the U.S. are an anomaly or if they signal the start of something more durable.

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:




Back to homepage

Trending Discussions


Leave a comment
  • Citizen Oil on July 28 2017 said:
    Take what Goldman says with a grain of salt . They change their tune weekly and they also didn't see the massive glut coming in 2014 either. 100 monkeys on 100 typewriters . SMH

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News