Goldman Sachs warns oil could reach $95

Tuesday 17 July 2007 11.14
Goldman Sachs warns oil could reach $95

The key Middle Eastern members of oil cartel OPEC are under pressure for an increase in production after a warning from Goldman Sachs that prices could hit a peak of $95 a barrel by the end of the year.

Goldman Sachs said in a research note oil prices could reach $90 a barrel this autumn and $95 a barrel by the end of the year if the Organization of the Petroleum Exporting Countries does not ease production cuts that have helped tighten global markets.

But OPEC says world oil demand next year will grow moderately while supply from rival producers will expand, reducing the need for crude from the producer group.

Today oil prices were little changed  at near record highs in Asian trade as the market waited for  the release of a weekly US report on energy stockpiles.

New York's main contract, light sweet  crude for August delivery, was four cents higher at $74.19 a barrel from $74.15 in late US trades last night.

Brent North Sea crude for September was two cents higher at  $76.31.

Oil prices are expected to remain well bid as supply concerns  continue to be a key factor for the market amid robust demand,  dealers said.

Oil has rallied strongly since last week after the International  Energy Agency raised its 2008 forecast oil demand by 2.5% to 88.2 million barrels a day.

The US Department of Energy (DoE) is due to release on Wednesday its weekly report on the country's energy reserves.