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The price of oil at $90 a barrel may lead to an acceleration of production by OPEC+ countries, said Goldman Sachs analysts. This is reported by Bloomberg.
In their view, such a decision of the alliance will lead to a short-term jump in oil prices. However, Goldman Sachs notes that despite the rise in prices, OPEC+ will have to weigh several factors that could weaken them.
These include renewed rumours of possible US plans to draw down strategic reserve stocks again, a reduction in the volume of oil used as a substitute for natural gas with the end of winter, and progress in negotiations on Iran's nuclear programme, which could lead to the lifting of sanctions on Iranian oil.
Growing chances of Iranian oil exports resuming are likely to play against a significant increase in production, the analysts point out.
Meanwhile, the market expects OPEC+ to approve a 400,000 bpd supply increase for March at its next meeting, believe traders and representatives of about half of the organisation's countries.
However, the agency's interlocutors expressed doubts that OPEC+ will be able to meet its production target. Thus, Gunvor’s head Torbjörn Törnqvist said that only Saudi Arabia, the UAE and Iraq have sufficient reserves of production capacity. According to him, even Russia, the second largest OPEC+ member, has failed to increase production.
source: bloomberg.com
In their view, such a decision of the alliance will lead to a short-term jump in oil prices. However, Goldman Sachs notes that despite the rise in prices, OPEC+ will have to weigh several factors that could weaken them.
These include renewed rumours of possible US plans to draw down strategic reserve stocks again, a reduction in the volume of oil used as a substitute for natural gas with the end of winter, and progress in negotiations on Iran's nuclear programme, which could lead to the lifting of sanctions on Iranian oil.
Growing chances of Iranian oil exports resuming are likely to play against a significant increase in production, the analysts point out.
Meanwhile, the market expects OPEC+ to approve a 400,000 bpd supply increase for March at its next meeting, believe traders and representatives of about half of the organisation's countries.
However, the agency's interlocutors expressed doubts that OPEC+ will be able to meet its production target. Thus, Gunvor’s head Torbjörn Törnqvist said that only Saudi Arabia, the UAE and Iraq have sufficient reserves of production capacity. According to him, even Russia, the second largest OPEC+ member, has failed to increase production.
source: bloomberg.com
