Crude oil prices are likely to exceed forecasts as early 2018 progresses due to increased demand and strong adherence to production cuts, say Goldman Sachs.
The market is currently experiencing Brent crude prices at around $70 a barrel, a price not seen since 2014.
The global finance company have said that the decision to push up the oil price by OPEC and Russia’s decision to suppress production has combined with a near 15% increase in demand since December 2017.
Speaking to Reuters, a Goldman spokesperson said: “This rally has been driven first by robust fundamentals, with strong demand growth and high OPEC compliance accelerating. While their hedge coverage is relatively high for 2018, that is not the case for 2019 and we expect oil producers to start extending their hedge tenors.”