Goldman Sees OPEC Buying Time as Deal Could Boost Oil $7-$10
- Bank says output quotas may be exceeded amid demand growth
- Citi, Morgan Stanley see accord helping U.S. shale industry
OPEC Production Cut: Saudi Arabia's Big Gamble
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Goldman Sachs Group Inc. said OPEC’s deal to cut output could add as much as $10 a barrel to oil prices, though it remains skeptical along with other banks on how the accord will be implemented.
The plan to reduce production to a range of 32.5 million to 33 million barrels a day “will likely provide support to prices, at least in the short term,” Goldman said in a report dated Sept. 28, but maintained its crude forecasts for 2016 and next year. Uncertainty in the market will persist in coming months, and output quotas could still be exceeded even if the proposal is ratified at a formal gathering in November, according to Goldman.