Oil prices will surge to $100 this year, Goldman Sachs warns [View all]

Source: CNN

Goldman Sachs is now calling for oil prices to hit $100 a barrel later this year and continue rising in 2023, signaling higher prices at the pump are on the way.

That's why Goldman now expects Brent crude, the world benchmark, will hit $100 a barrel in the third quarter of this year, up from the bank's prior call for $80. Goldman sees Brent hitting $105 a barrel next year, up from a previous forecast of $85. Brent climbed another 0.7% on Tuesday to $87.23 a barrel.

"Importantly, we are not forecasting Brent trading above $100/bbl on an argument of running out of oil as the shale resources is still large and elastic," Goldman Sachs strategists wrote.

Goldman Sachs said shale oil will "Likely require ever rising oil prices given the reluctance to invest in oil during the energy transition" and the gradual depletion of shale capacity over time.

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