- Goldman Sachs expects crude oil to hit $110 per barrel next year, representing upside of more than 30%.
- The investment bank’s commodities chief said the outlook for oil in 2023 is “very positive.”
- But in an interview with CNBC, he also acknowledged that there’s “a lot of uncertainty” ahead.
Despite concerns over China’s zero-COVID policy and global recession fears, Goldman Sachs expects Brent crude oil prices to hit $110 a barrel next year.
Jeff Currie, global head of commodities at the investment bank, said Tuesday that the oil outlook in 2023 remains “very positive.”
He told CNBC in an interview that Goldman plans to “stick to our guns” with a forecast for $110-a-barrel Brent. That represents more than 30% upside from the current level of around $83.
Still, there’s “a lot of uncertainty” ahead, Currie noted, including the potential for lower demand in China, recession fears, and the European Union’s embargo next week on seaborne imports of Russian oil.
“Demand is probably heading south again in China given what’s going on,” he said. “I think the key point with China right now is the risk that you get a forced reopening. That means it’ll be self-imposed lockdowns where people don’t want to get on trains, don’t want to get to work and demand goes further south.”
Meanwhile, OPEC+ will convene in Vienna on Sunday, and Currie said there is a high probability that the cartel will further reduce its oil production quotas, putting upward pressure on prices.