Goldman sees oil slump until global GDP stabilises
LONDON, Oct 7 (Reuters) - Oil prices are unlikely to rebound significantly while pessimism about the strength of the global economy continues, Goldman Sachs (GS.N) analyst Arjun Murti said.
The Goldman equity analyst was one of the first to predict crude prices would "super spike" above $100 a barrel back in 2005, and earlier this year went on to forecast prices could jump to between $150 and $200 a barrel by the end of 2009.
"Oil prices increasingly appear unlikely to sustain a rally until global GDP expectations bottom," Murti said in a note dated October 5th.
"While we believe oil supply/demand fundamentals are not as bearish as is sentiment, we recognize that concern continues to mount towards global oil demand growth."
Murti has maintained his prediction that oil will average $120 a barrel in Q4 2008, but acknowledged that the recent fall in oil prices and the global economic slowdown now made this less likely than before.
"Weakening global GDP and continued technical selling pressure suggests risk/reward relative to our $120 a barrel Q4 2008 forecast is to the downside."
Goldman Sachs are the most active bank in commodity markets.
NYMEX crude oil was trading at $90.85 at 1148 GMT, having slumped to an 8-month low of $87.56 a barrel on Monday. (Reporting by David Sheppard; editing by James Jukwey)
