"In general, the recent price moves are consistent with our views. In oil, we continue to expect the market to move into deficit in late 3Q09, which will begin to relieve some of the downward pressure on timespreads that we anticipate will continue until the fundamentals improve. We also believe that industry economics support long-dated prices around $75/bbl for the balance of the year and thus have cautioned that the build-up of investor length that pushed long-dated prices above $80/bbl in the past month was likely overdone, leaving the market vulnerable to liquidation risk." See page 9 below.
Huh?
Isn't this what they said on June 4th? Did we see "overdone" or "liquidation" risk?
Goldman Sachs, Wall Street’s largest commodities dealer, raised its oil price target for the end of 2009 to $85 a barrel, from a previous projection of $65 a barrel, and said prices could flirt with the $100 level by the end of 2010.
“The recent rally in WTI prices is likely to be but the first stage in the oil price rally that we expect will accompany a recovery in economic activity,” said Jeffrey Currie, commodity strategist at Goldman Sachs.
He added: “In all, we expect the rally we have just observed to be followed by three more stages, creating a four-stage rally in oil prices in 2009 and 2010.”
Goldman said that the second half of 2010 was likely to see a return to energy shortages as dwindling spare capacity among Opec producers would be unable to meet rising demand as non-Opec production growth would be restricted by limited investment in infrastructure.
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