Focus on the BIG picture.
Friday, May 09, 2025

All-Time High Oil Demand: Goldman Sachs Forecasts Imminent Deficits and Price Surge

Economic uncertainty and reduced rig count in the US drive warnings of a sharp rise in oil prices amid record-breaking demand.
Investment banking titan, Goldman Sachs, has issued a warning of impending record-breaking demand in the global oil market. This surge, accompanied by considerable deficits and escalated crude oil prices, is attributed to the diminishing rig count in the United States and widespread uncertainty about long-term oil demand.

In an interview on CNBC's "Squawk Box Asia" on Monday, Daan Struyven, Goldman's Head of Oil Research, detailed the bank's prediction of "pretty sizable deficits" in the second half of the year. As per his explanation, these deficits are anticipated due to the demand for oil reaching unprecedented highs.

Goldman Sachs anticipates that the price of Brent crude, a key benchmark, will jump from its current value just north of $80 per barrel to an estimated $86 per barrel by the end of the year.

Struyven clarified that while US crude production saw significant increases over the previous year, the pace of this growth is predicted to taper off for the remainder of 2023. The cause? A decrease in the number of operational rigs. Reports from last week showed that the US oil rig count has fallen to its lowest point since March 2022.

Struyven also pointed out the failure of the G20 energy ministers to reach a unified agreement on phasing out fossil fuels during last week's summit in India. This deadlock further illustrates the "very substantial" uncertainty clouding the future of oil demand.

The International Energy Agency (IEA), on the other hand, anticipates the oil markets to tighten in the year's second half. In its recent report, the agency cut back its global oil demand growth projections. However, IEA's Director Fatih Birol acknowledged these projections could be amended upward, depending on China and other countries' economic growth.

Oil prices experienced a roller-coaster ride for much of 2022, partly due to Western sanctions on Russia, a significant producer. However, as the year neared its end, prices experienced a sharp decline, thanks to a milder winter in Europe and a slowdown in global economic activity.

In a move to balance prices, OPEC+, consisting of the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, agreed in October to reduce its output by approximately 2% of world demand from November until the end of 2023. Further cuts were agreed upon later to maintain equilibrium in prices.

As of Monday, Brent crude futures had reached over $82 per barrel, and West Texas Intermediate (WTI) futures in the US were trading above $78 per barrel. With these trends and the forecast from Goldman Sachs, the oil industry is bracing itself for an eventful near future.
Newsletter

Related Articles

0:00
0:00
Close
Historic Papal Conclave Set to Commence in Rome
Huge Copper, Gold, and Silver Discovery in Argentina and Chile — But the Profits Go Abroad
The Road to Freedom: She Protested Putin, Escaped House Arrest, and Survived a 2,800-Kilometer Journey
Prince Harry is pleading for reconciliation — but the royals are just as sick of his victimhood as everyone else
OpenAI's Flip-Flop: No Longer Going Commercial, Back to Nonprofit, After Musk Lawsuit and Backlash
First From China: Zhao Xintong Wins the Snooker World Championship
Nvidia Faces Billion-Dollar Losses – Warns: China Is on Its Way to Becoming an AI Superpower
Trump Rules Out Third Term, Names JD Vance and Marco Rubio as Potential Successors
Mexico Says ‘No’ to U.S. Troops: President Sheinbaum Rejects Trump’s Offer to Fight Cartels
Nigel Farage’s Reform UK Storms the Map, Wrecking the Two-Party Monopoly
DOGE: Reimagining Government Operations with AI
EU Hits TikTok with €530 Million Fine Over China Data Transfers
Beijing Says U.S. Is ‘Reaching Out’ for Tariff Talks Amid Soaring Trade Tensions
U.K. Court Rejects Prince Harry’s Final Appeal Over Police Security
Warren Buffett to Step Down as Berkshire CEO After Nearly 60 Years
Prince Harry’s Heartfelt Outburst Rocks the Royal Family
Trump Shares AI-Generated Image of Himself as… Pope, Prompting Outrage Reaction
Transgender Swimmer Secures Five Gold Medals at U.S. Masters Championship
Prince Harry: “I Want Reconciliation with My Family”
Germany's Alternative für Deutschland (AfD) party has now been officially labeled “right-wing extremist” by the federal office for the so-called “protection of the constitution.”
Amazon Launches Satellite Internet Service Amidst Competition with SpaceX
Transformative Changes in Women's Wrestling: The Rise of WWE Superstars
The Rush to the White Gold: Global Investment Surge in Natural Hydrogen Exploration
This is a day in Spain without electricity and internet
180-Year-Old Christian University in South Carolina Announces Closure Due to Unmet $6 Million Fundraising Goal
Brazilian Woman Jailed for Fourteen Years for Writing “You Lost, Idiot” on Statue During Protest
Trump Administration Removes National Security Adviser Mike Waltz Amid Signal Chat Controversy
Huawei Ramps Up Testing of Powerful New AI Chip in Challenge to Nvidia Amid U.S. Sanctions
Dutch Politician Eva Vlaardingerbroek Receives Spyware Threat Alert from Apple
Paramount Board Considers Settlement in Trump’s $20 Billion Lawsuit Over "60 Minutes" Interview
U.S. Economy Shrink in Trump’s First Quarter as Tariff Policy Raises Questions
U.S. and Ukraine Poised to Sign Strategic Critical Minerals Deal Amid Geopolitical Shifts
Sweden Grapples with Deadly Gun Violence: Suspect Arrested After Three Young Men Killed in Uppsala Hair Salon
Walz Reveals Why Harris Chose Him as Her Running Mate and Reflects on Democratic Losses
Spain Restores Power After Unprecedented Nationwide Blackout
Carney Secures Liberal Mandate in Canada’s Federal Election
Death Penalty Sought as Luigi Manion Pleads Not Guilty in CEO Murder Case
President Trump contacts Jeff Bezos after reports of Amazon considering listing tariff surcharges; company clarifies no such plan for main platform
Spain and Portugal Recover from Massive Blackout
Liverpool Clinches Record-Equalling 20th English League Title Under Arne Slot
Massive Raid on Underground Nightclub in Colorado Springs Yields Over 100 Arrests
Singapore Politicians Warn Against Foreign Interference in Election
Driver Ploughs into Vancouver Festival Crowd, Killing Nine
Depression, Fear of Defamation, and a Tragic End: New Details on Virginia Giuffre’s Suicide
“Sharia for UK, Allah Akbar!”
China Warns Nations Against Trade Deals Harmful to Its Interests
Malaysia Revises Growth Outlook Amid US Trade Talks
Massive Explosion at Iran's Bandar Abbas Port Linked to Suspicious Chemical Shipments
Wild Courtroom Chaos: FBI Arrests Milwaukee Judge for Helping Illegal Immigrant Flee from ICE Agents!
Pakistani migrants to Danish man: “ “We have 5 children while you have 1 or 2. In 10 years, there will be more Pakistanis than Danes here.“
×