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Goldman Cuts 2007 U.S. Oil Forecast for Second Time

Reuters
Monday, 8 Jan 2007 | 2:42 AM ET

Goldman Sachs, among the biggest oil price bulls in a Reuters poll, has cut its 2007 U.S. crude price forecast by $3.50 to $69 a barrel due to unusually warm winter weather in the United States, its second reduction in just over two weeks.

"Although some of this warm weather was already embedded in our price forecasts, the weather deviation since mid-December ...through first part of January will likely reduce oil demand by a further 46 million barrels relative to our prior assumption of normal weather, which would be worth approximately $3.70 a barrel to the oil price," it said in a report dated Jan. 5.

Goldman, which held the most bullish 2007 forecast in Reuters poll of over 30 analysts in the first part of last year, had already cut its forecast for this year by $3 on Dec. 22, citing unexpectedly high U.S. oil inventories.

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