Goldman lifts 2018 oil price outlook on strong OPEC resolve

Saudi Energy Minister Khalid al-Falih said the deal would most likely be extended by nine months and no deeper reductions were needed.

OPEC and its allies’ strong commitment to extended oil supply cuts will lower inventories next year and lift prices, according to Goldman Sachs Group Inc.

The bank raised its forecast for Brent crude for 2018 to US$62 a barrel from US$58 and for West Texas Intermediate to US$57.50 from US$55, Goldman analysts including Damien Courvalin said in a Dec. 4 note.

The bank also boosted its Brent price outlook for 2019 to US$59.50 a barrel from US$58 and for 2020 to US$54.50 from US$53.

The Organization of Petroleum Exporting Countries and its allies exceeded expectations with their resolve last week when they agreed to extend production curbs by nine months to the end of 2018, Courvalin said.