Goldman lowers Brent forecast



REUTERS

Published — Thursday 25 April 2013

Last update 25 April 2013 4:01 am

| نسخة PDF Print News | A A

NEW YORK: Goldman Sachs lowered its 2013 Brent price forecast to $ 105.00 from $ 110.00, as a possible slowdown in Chinese demand, weaker-than-expected European demand, and higher European refinery activity were seen weighing on crude oil.
Goldman also lowered its three-month Brent forecast to $ 100.00 per barrel from $ 110.00 it said in a note.
Goldman said its Chinese economists saw near-term headwinds to real growth improvement continuing, along with an increased risk that Chinese oil demand growth will remain relatively weak in the near-term.
It also shifted its near-term outlook on commodity returns to Neutral from Overweight, citing deepening concerns around global growth.
Goldman left its assumption on the WTI-Brent spread unchanged, with its 12-month outlook for WTI crude at $ 97.00 per barrel.
Brent crude rose above $ 101 a barrel yesterday as stockpiles of gasoline declined in top consumer the US, but gains were checked by the prospect of slower growth and fuel demand in major economies.
The North Sea benchmark had been trending higher in earlier trade, tracking European equities on a view that central banks could intensify efforts to revive a flagging global recovery.
And the possibility of stronger demand for US gasoline emerged after data from the Energy Information Administration (EIA) showed stocks of the motor fuel slumped last week.

“The report is supportive to prices due to the large decline in gasoline inventories,” said John Kilduff of Again Capital LLC in New York.
“Being the seasonal leader of the complex, the decline will have an outsized effect on price action.
Brent futures were up 71 cents at $ 101.02 a barrel by 1458 GMT, while US oil gained 97 cents to $ 90.15.
Oil’s gains were kept in check by gloomy economic data in big consumers.
Growth in Chinese factories slowed to a crawl as export demand dwindled, while Germany, the euro zone’s largest economy, saw business activity decline for the first time in five months.
The prospect of a slowing global economy dampening oil demand growth has already shaved $ 10 off the price of Brent since the start of April. And uncertainty over global growth may result in commodities facing increased volatility.
“We continue to view recent weakness in the data flow as consolidation, rather than the start of a 2012-style capitulation, but remain watchful of the loss of momentum in the manufacturing sector from these key countries,” analysts from ANZ bank said in a note.
In the US, crude stocks fell last week as imports dropped while refined fuel inventories were mixed, data from industry group the American Petroleum Institute (API) showed late on Tuesday.
API’s data showed that crude inventories fell by 845,000 barrels in the week to April 19, compared with analysts’ expectations for an increase of 1.5 million barrels.

What's happening around Saudi Arabia

JEDDAH: An African expat woman is being investigated for torturing her baby to death by pouring boiling water on her. The motive behind the vicious attack is unknown.The Board of Investigation and Prosecution in Jeddah has charged the woman with semi...
RIYADH: Over five million Overseas Filipinos Workers (OFWs), including more than one million in Saudi Arabia, observed “zero remittance day” on Friday, in protest against the random checking of boxes sent by them to their families back home by the Cu...
RIYADH: The Ministry of Health announced on Friday that two more people were infected with the Middle East Respiratory Syndrome (MERS) coronavirus. While no deaths were announced, the virus has already killed 26 people in just two weeks, from Aug. 16...
JEDDAH: As international schools in the city gear up for the new academic session, some parents have requested that schools improve the quality of their classes in Islamic studies. Although the Ministry of Education has decreed that all international...
JEDDAH: Health Minister Khaled Al-Falih met with Grand Mufti Sheikh Abdul Aziz Al-Asheikh on Thursday to discuss the Health Ministry’s proposed ban on sacrificing camels during this year’s Haj.Several health officials accompanied Al-Falih at the meet...
MAKKAH: The executive list of the child protection system has now defined 14 kinds of abuse.These include keeping a child without a family document, not administering compulsory vaccinations, disrupting their education, exposing them to an environmen...

Stay Connected

Facebook