Goldman Sachs: Oil Prices to Stay Low for 15 Years

by Ship & Bunker News Team
Thursday September 17, 2015

There was good news for bunker buyers Wednesday, with Goldman Sachs Group Inc. (Goldman Sachs) predicting that the current glut of oil will keep crude prices low for the next 15 years, Bloomberg reports.

"When we think of the longer term oil price, yes we put it at $50 a barrel," Jeffrey Currie, head of commodities research at the bank said yesterday during an interview in Canada's oil province, Alberta.

The world is in a 30-year commodity cycle, he explained, and is now shifting from the "investment phase" to the "exploitation phase."

Currie also sees shale fields as an important source of future output, although Goldman Sachs analysts and the International Energy Agency (IEA) see non-OPEC oil out dropping dramatically next year.

Goldman Sachs is one of a several industry voices who believe oil could touch down to $20 a barrel, and Currie explained that will most likely happen in October or March when refineries shut for maintenance.

Key to the new belief that prices are heading even lower than previously thought is the realisation that the oil market is even more oversupplied than had been previously expected, although Currie puts the odds of a dip to $20 in order to "clear the glut" at less than 50 percent.

Ship & Bunker reported yesterday that, should crude dip under $30 per barrel, it could well push bunkers under $150 per metric tonne.

Ship & Bunker News Team
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