• 4 minutes Energy Armageddon
  • 6 minutes How Far Have We Really Gotten With Alternative Energy
  • 10 minutes Wind droughts
  • 2 hours GREEN NEW DEAL = BLIZZARD OF LIES
  • 11 hours "Biden Is Running U.S. Energy Security Into The Ground" by Irina Slav
  • 11 hours "Natural Gas Price Fundamental Daily Forecast – Grinding Toward Summer Highs Despite Huge Short Interest" by James Hyerczyk & REUTERS on NatGas
  • 6 hours "How to Calculate Your Individual ESG Score to ensure that your Digital ID 'benefits' and money are accessible"
  • 2 days Oil Stocks, Market Direction, Bitcoin, Minerals, Gold, Silver - Technical Trading <--- Chris Vermeulen & Gareth Soloway weigh in
  • 1 hour "Europe’s Energy Crisis Has Ended Its Era Of Abundance" by Irina Slav
  • 11 hours The Federal Reserve and Money...Aspects which are not widely known
  • 3 hours Uniper is over - Germany (Government) buys the Company
  • 6 hours "How BlackRock Conquered the World" by James Corbett (all 3 parts)
  • 12 hours "Oil prices likely not responsible for inflation and other energy insights by hedge fund manager Josh Young" - Kitco News interview by David Lin
  • 13 days "Forget Oil, The Real Crisis Is Diesel Inventories: The US Has Just 25 Days Left" by Zero Hedge - 5 Stars *****
  • 6 days "Dodgy Demand Data? The Oil Price Collapse Conspiracy" by Alex Kimani
  • 13 days "The Global Digital ID Prison" by James Corbett of CorbettReport.com
WTI Drops To $80 As Bearish Momentum Grows

WTI Drops To $80 As Bearish Momentum Grows

Crude oil is likely to…

Goldman Sachs Slashes Oil Price Forecast By $10

Goldman Sachs Slashes Oil Price Forecast By $10

Goldman Sachs has slashed its…

No Deal On Russian Oil Price Cap As Deadline Looms

No Deal On Russian Oil Price Cap As Deadline Looms

The European Union has failed…

Irina Slav

Irina Slav

Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.

More Info

Premium Content

Oil To Crash Back To $40 If OPEC Fails

OPEC’s increasingly probable failure to reach a production freeze deal will see international oil prices plummet back to US$40 a barrel, according to Goldman Sachs analysts. In a note to clients, the experts went further, cautioning that even if the cartel managed to seal a deal, driven by the bearish prospects in a no-deal scenario, its effectiveness will be at best uncertain.

“The lack of progress on implementing production quotas and the growing discord between OPEC producers suggests a declining probability of reaching a deal on November 30,” the analyst team said, noting that while the negotiations were ongoing, OPEC output in October continued to rise, as did the production of non-OPEC mega producers such as Russia.

These developments have greatly diminished the chances of any production freeze leading to a decline in global crude oil supply and a subsequent increase in oil prices over the next seven months.

This is not the first time Goldman has made a very bearish forecast for oil prices. Last year, the investment bank was the first among its peers to warn that oil prices could slump to US$20 a barrel if the glut continued. This is what almost happened in early February this year, when WTI touched lows of US$26 a barrel. Related: Will Oil Majors Ever Recover?

Although this trough was only touched briefly, it certainly rattled markets, and later in the year, it raised doubts among OPEC’s leading producers as to whether their strategy of fighting shale oil with cheaper output was paying off.

As it turns out, it wasn’t, so Saudi Arabia became the initiator of the September talks about a production freeze that was supposed to draw in non-OPEC producers such as Russia, Brazil, Kazakhstan and Azerbaijan, in order to make the effort meaningful.

Yet, Brazil has declared it has no intention of cutting or even freezing its crude oil production, Russia is playing its cards close to its chest, and, what’s more important, the discord within OPEC is growing. If the internal differences of OPEC members are not ironed out by November 30, there won’t be a deal and oil will plunge to greater depths.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:


Download The Free Oilprice App Today

Back to homepage





Leave a comment

Leave a comment




EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News