Oil Could Reach $107 Due To Saudi And Russian Cuts

Oil prices could surge into triple-digit territory next year if Russia and Saudi Arabia do not reverse their aggressive supply cuts, according to a warning from Goldman Sachs to its clients, Matt Egan reported this for CNN.

Brent crude oil could get pushed to above $91 a barrel for the first time in 10 months.

The Wall Street bank had already taken into account the possibility of high oil prices long before Russia and Saudi Arabia announced earlier this week that they would extend production cuts through the end of 2023.

This news pushed Brent crude oil above $91 a barrel for the first time in 10 months. Brent crude serves as the world's oil price benchmark and is produced in the North Sea.

Goldman Sachs had initially forecasted Brent oil to be at $86 in December and $93 at the end of 2024. Now, the bank states that it sees "two bullish risks" to its prediction. First, Goldman Sachs anticipates that Saudi oil supply will be 500,000 barrels per day (bpd) lower than expected. This alone should add $2 to the per-barrel price of oil.

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