Oil may fall to $50 per barrel: Goldman

Reuters
Posted: Monday, Oct 13, 2008 at 0908 hrs IST
Updated: Monday, Oct 13, 2008 at 0908 hrs IST

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Oil hovers below $79 after 3-day slide Oil spikes to USD 81.26 a barrel Oil eases to USD 78.65 a barrel Oil tops $80, highest since Oct 14, 2008

Perth, October 13: : Goldman Sachs, once one of the foremost bulls on commodities, turned a near-term bear on Monday after conceding that global financial turmoil would take a far bigger toll on demand, warning that $50 oil was possible if the crisis deepened.

"We have underestimated the depth and duration of the global financial crisis and its implications on economic growth and commodity demand," its commodity markets research team said.

The bank cut its year-end US crude oil target to $70 a barrel, down from a previous forecast of $115 a barrel, and slashed its average 2009 forecast by a third to $86 a barrel.

The price fall has caused some OPEC members to call for a cut in production levels, and the cartel has agreed to hold an emergency meeting in Vienna on Nov. 18 to discuss the impact of the global financial crisis on the oil market.

Iran is set to push for a cut in oil output at an OPEC emergency meeting in November, its oil minister said in comments published on Sunday, adding investment conditions in the oil industry would be severely hit unless OPEC acted decisively to arrest the current fall in oil prices.

But Saudi Arabia, the world's biggest exporter and OPEC's most influential member, has shown no signs of taking pre-emptive action to stem the slide in prices, telling major Asian refiners that it will maintain crude oil shipments unchanged next month, according to notices sent to refiners.

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