Goldman Sachs no longer sees oil at $100 in 2023

Goldman Sachs cut its forecasts for Brent crude oil futures over the weekend after prices slumped 15% since early March on banking and recession fears.

The investment bank is now expecting Brent to average $94 a barrel in the next 12 months and $97 in the second half of 2024, down from $100 previously, it said in a note dated March 18.

“Oil prices have plunged despite the China demand boom given banking stress, recession fears, and an exodus of investor flows,” the bank’s analysts said.

“Historically, after such scarring events, positioning and prices recover only gradually, especially long-dated prices.”

The bank has also lowered demand projections for Europe and North America in 2023 while raising that for China.

This led to a 600,000 barrel per day cut for 2024 estimates while keeping 2023 demand forecast unchanged.