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Its too late for OPEC to rescue oil – Goldman Sachs

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Feb 2, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    FXStreet (Mumbai) - Analyst at Goldman Sachs believed the recovery in oil prices towards the end of January was only a dead cat bounce.

    The Wall Street banker said that the black gold is set to record new multi-year lows below $ 26, despite chatter around OPEC coming to save the oil markets.

    Goldman Analysts noted in its latest report:

    "It may already be too late for OPEC producers to be able to prevent another large decline in prices."

    "We continue to view a coordinated production cut as highly unlikely and ultimately self-defeating."

    “Giving in now would backfire on OPEC by allowing U.S. production -- which is slowly declining -- to rebound. That's because the American shale oil companies that have powered the U.S. energy boom would be able to quickly ramp up output once prices rise.”
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