by: Arsenio Toledo
(Natural News) The price of oil will rise above $100 a barrel again this year, and will continue to rise in 2024 due to serious supply problems when the excess production capacity ran out.
This dire warning comes from Goldman Sachs senior analyst Jeff Currie, who was speaking at an event in Riyadh, Saudi Arabia. “The super cycle of raw materials it is a sequence of price spikes, with each higher high and each lower low,” Currie said.
He warned that the continued lack of spending in the oil industry, especially spending needed to boost production, will make oil companies unable to meet demand. This necessary expense includes exploration of new oil fields.
This lack of investment will be the main driver of higher prices, which the world will start to feel in 2024. (Related: Regional emergency declared in eight states due to shortage of gasoline, diesel and jet fuel.)
Oil prices have been volatile for years, dipping below $20 a barrel on weak demand caused by the Wuhan coronavirus (COVID-19) lockdowns, before soaring to around $130 a barrel on beginning of Russia’s special military operation in Ukraine, which disrupted global supply that was already well below global demand at the time.
Other factors that have affected the price of oil since then include the price of fuel transportation due to the fact that refineries are reaching the limit of their capacity, as well as embargoes and sanctions in oil-exporting countries like Russia.
Oil will rise to $105 a barrel by the end of this year
Goldman Sachs predicts that the price of Brent crude will rise to $105 per barrel by the last quarter of 2023. Currently, Brent crude is trading between $75 and $80 per barrel.
But Goldman and other investment banks have warned that the price of oil will rise further by the end of the year. Currie noted that by May of this year, the oil market will enter a supply deficit as demand continues to rise, but it will not be matched by a similar increase in production. Instead, what little spare capacity global producers have will be depleted.
Currie noted that Goldman Sachs’ view is that the Organization of the Petroleum Exporting Countries-Plus (OPEC+) will remove production caps and look to ramp up output sometime later this year. An OPEC+ market monitoring committee has just announced recommendations to keep oil production unchanged in February.
Saudi Arabia already plans to raise prices for its Asian, European and American consumers. despite keeping oil production virtually unchangedwhich strongly suggests that the kingdom sees oil demand picking up significantly this month.
“Right now, we are still balanced in a surplus because China has yet to fully recover,” Currie said. But, when demand exceeds supply in May, the situation will start to become problematic.
“Are we going to run out of additional production capacity?” he asked. “Potentially by 2024, you start to have a serious problem.”
During the conference, the Minister of Energy, Prince Abdulaziz bin Salman, denounced the lack of investment in refining capacity that is about to leave the world with insufficient supply. He noted that the Saudis have been warning about this for more than a year.
“All those so-called sanctions, embargoes, lack of investment, will be entangled in one thing: Lack of energy supplies of all kinds when they are most needed,” warned the prince.
Learn more about the energy situation in the United States and other nations at NewEnergyReport.com.
Listen to this episode of the “Health Ranger Report” with Mike Adams, the Health Ranger, discussing Saudi Arabia’s plan to end dollar dominance in global oil trade.
This video is from Health Ranger reporting channel at brighteon.com.
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