According to a note from analysts at the investment bank, Goldman Sachs is optimistic about the future of all commodities. The bank’s head of commodities, Jeffrey Currie, has stated that the outflow of capital from the energy industry will result in shortages that will appear later this year.
Currie also anticipates a deficit by June, which will push up oil prices. He attributes this rise to the slow return of capital after a major market event, which historically takes months. Specifically, the bank points out an expected demand increase in China to more than 16 million barrels daily over the period, contributing to their bullish outlook. Reuters reported Currie’s remarks at the Financial Times Commodities Global Summit.
Hedge Fund Manager Andurand Also Bullish on Oil Prices, Expects Rise to $140 per Barrel by Year End.
Pierre Andurand, a hedge fund manager, shares Goldman Sachs’ bullish outlook on oil prices. Andurand predicts that prices will rebound and reach $140 per barrel by the end of the year. He believes that the current slump in prices was speculative and stemmed from the banking sector.
While Chinese energy commodity imports were lackluster during the first two months of 2023, they are expected to increase later in the year with potentially record-high crude oil purchases. Although Beijing has set its lowest annual economic growth target in decades, most analysts anticipate a 5% growth rate in Chinese demand for oil in the coming months.
The modest 1.3% decrease in average oil imports during the first two months of the year is typical due to the Lunar New Year holidays in China. Additionally, new refining capacity coming online this year is expected to contribute to stronger demand and support oil prices.
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