Oil prices (CL=F, BZ=F) tick up on the first day of February as geopolitical tensions persist in the Red Sea region. Goldman Sachs Head of Natural Gas Research Samantha Dart breaks down the oil market’s monthly gains, stating there is still “a lot of supply spare capacity in the system” with minimal supply chain disruptions.
“We expect to see oil prices peaking this year in the low to mid-80s. so we’re pretty close to those levels already. We don’t see a lot of fluctuations unless we have a significant supply disruption in the system,” Dart explains to Yahoo Finance.
#oil #stockmarket #youtube
About Yahoo Finance:
Yahoo Finance provides free stock ticker data, up-to-date news, portfolio management resources, comprehensive market data, advanced tools, and more information to help you manage your financial life.
– Get the latest news and data at finance.yahoo.com
– Download the Yahoo Finance app on Apple (https://apple.co/3Rten0R) or Android (https://bit.ly/3t8UnXO)
– Follow Yahoo Finance on social:
X: http://twitter.com/YahooFinance
Instagram: https://www.instagram.com/yahoofinance/?hl=en
TikTok: https://www.tiktok.com/@yahoofinance?lang=en
Facebook: https://www.facebook.com/yahoofinance/
LinkedIn: https://www.linkedin.com/company/yahoo-finance
Oil edging higher to start the month of February as the market digests the fed’s path for inflation or interest rates rather and the latest OPEC meeting now this coming after oil prices close out January with its first monthly gain since September here to dive into the
Energy trade we’ve got Sam Dart who is the Goldman Sachs head of global natural gas research Sam great to have you here with us this morning first and foremost as we come off of the month of January and and kind of look back to what fluctu
Ation we saw on the oil price Market what what does that set up what’s the trend looking like going into February yeah so the the geopolitical tensions uh especially in the Red Sea region uh have definitely played a role and had L have lent support to oil
Prices a few dollars um a barrel in in recent weeks right but the way we look at the market we still see oil prices range bound between 70 and 90 a barrel a big reason for that is at the end of the day despite the tensions we have not had serious Supply disruptions
And in fact we still have a lot of Supply spare capacity in the system so Sam what does that mean then for price is going for because here we are with Brent right around 82 bucks you have crude that has been moving to the upside are we near that top that we
Would potentially see at least in the short term given the fact that this disruption hasn’t had a massive impact on the crude Market yeah we think we are uh we expect to see oil prices speaking this year in the low to mid 80s um so we’re pretty close to
Those levels already we don’t see a lot of fluctuations unless we had a pretty significant Supply disruption in the system what what would a significant Supply disruption look like is that an OPEC decision is that more International uncertainty or or conflict there that stems what is perhaps that biggest
Headwin risk that then Spurs um the the perhaps exogenous threat right so OPAC has been cutting Supply now for many many months so um the way that has played out because inventories are not particularly tight it’s actually it provided a cushion to the market meaning if things go tight
You can have that cushion used with OPEC bringing back Supply now the big risk to your point is if there is some exogenous factor that can block it so for example if we had a blockage of the straight of hermus which would indeed block a lot of
Saudi supply of oil that would be extremely problematic for the markets because it would it would impede OPEC from bringing back barrels to the market now to be very clear we think this is very very low probability this has never happened and there is a reason for it it
Would block by the way not just oil supplies but a a large share of l& liquefied natural gas supplies to the world as well see another trade that got our attention is the price of lithium the fact that it has been under tremendous pressure now for quite some
Time a bit of good news here for some of those EV players that are struggling with demand when it comes to that depressed price of lithium do you expect it to stay at these levels or what is the trend look like do you think for 2024 yeah this is something we have been
Calling for uh for a few months as well um that it’s interesting because we talk so much about green demand and and this is a strong pillar of our bullish commodity views but especially on the copper side when it comes to lithium the issue is that Supply is is is very
Abundant so even though demand is there and it’s still growing you don’t have tightness in the market so we expect this softness to continue on the lithium side whereas on the copper side what we see is the opposite we see demand still growing but the supply picture is
Actually getting tighter um year after year you know as as we’re thinking across some of the Commodities what is the hottest area that investors perhaps should be positioning their portfolio or or adding some type of positioning in their portfolio where you’re seeing a lot of volume or
Inflows right so I would say two things from our side where we see most upside is really copper and refined oil products and the reason is on the copper side as I said Supply is windling so you have a tighter entire market and on the refining side you know I I just
Mentioned the spare capacity from OPEC for oil that does not exist among oil products so the product Market is very tight as well so when we recommend um the best opportunities we really focus on those two copper and and oil products now when we talk to invest where we see
The most interest has been on the copper side I think that’s the most consensus View at the moment whereas on the refining side we still get some push back with investors expecting High product prices to fix the problem by inviting more refining capacity we don’t think that’s likely just because
Refining capacity takes really a long time to build and especially these days when you have so much uncertainty regarding long-term oil demand it’s difficult to also get Capital availability for that kind of investment s let’s talk about gold real quick before we let you go because it is under
A bit of pressure this morning but not maybe as much as investors would have anticipated given the fact that fed share J pal basically said that the FED is not going to cut rates in March when the fed or if the FED eventually does decide when it does decide to cut rates
How big of a catalyst do you think that’s going to be for gold prices yeah it it’s definitely a powerful Catalyst and by by the way that’s another commodity uh where we see a lot of investor confidence um it’s one of the preferred Commodities we think
That support is still there and yes as you pointed out in large part because of declining rates going forward but also supported by geopolitical risks so there are a lot of good reasons to go into gold right now we still expect it to go above 2100 by year end all right Sam
Dart always great to have you with Goldman Sachs thanks so much for taking the time to join us here this morning
1 Comment
Gold is a sucker bet and the only reason gold is currently at such an outlandishly high price is because the truth about the reality of the Equity Spending (ES) process is and has been deliberately kept from the American people for over fifteen years which truth reveals that we do not actually have a national debt since the federal deficit that is erroneously referred to as a national debt has accrued to this amount by electronically generating $s that describes the ES reality/process. This is to say that it is IMPOSSIBLE to borrow electronically generated $s thus we do NOT actually have a national debt.