Goldman: Oil Prices To Fall Below $40 If Shale Doesn’t Slow

12 Jul 2017   Prices

That prediction comes from Goldman Sachs, which says that the oil market is searching for a new equilibrium. The investment bank says that it is still too early to tell whether or not the most recent inventory reductions in the U.S. are an anomaly or the start of something more durable. Moreover, the higher-than-expected inventory declines in June occurred at the same time that Libya and Nigeria were adding new sources of supply. That is why the enormous drawdown, particularly last week, prevented the oil bulls from coming out in full force. Rightly so. The rig count also initially appeared to be slowing – and actually declined recently for the first time in months – but rebounded in the most recent data. The same was true for U.S. oil production data, which fell and then rebounded. All of this is short-term noise in the data, and it will take […]

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