Often bullish on oil, Goldman Sachs is changing stripes, or in this case, shedding its horns. The widely followed investment bank is now bearish on crude with its analysts predicting oil prices will fall another $10, ultimately dropping to $70 a barrel in 2015.
Largely, Goldman believes rising production will outpace demand.
On CNBC's "Closing Bell," Stephen Schork of the Schork Report said lower oil would likely have an impact on a wide range of stocks and sectors; if oil falls further, he'd be cautious of alternative fuel stocks and constructive on industrials , utilities and
Of course the biggest winner is probably people who drive. Looking at the impact on prices at the pump, Schork added, "If oil drops to $80, it translate to $2.95 per gallon, on average. If oil drops to $75, it means you'll pay $2.80, and if oil goes to $70, drivers are looking at $2.60."
But don't jump for joy, or jump in the car for a joy ride, just yet. It should be noted that Goldman's call was met with skepticism.
John Saucer, vice president of research and analysis at Mobius Risk Group in Houston sees oil very differently. "There are signs U.S. crude might be starting to stabilize after falling more than 25 percent since June," he said in a Reuters interview. "Certainly the market can push lower but it's going to need fresh impetus because we have already discounted into this market weak global growth, lower demand, a strong dollar and OPEC and Saudi Arabia's views (on supply)."
By the sessions close, Saucer's outlook appeared to be validated, at least temporarily, by the price action in the market. U.S. oil prices rebounded after tumbling to a 28-month low below $80 per barrel.
If crude falls to $70 a barrel next year, as Goldman Sachs is forecasting, it would be the lowest level since 2010. Goldman says it could happen as soon as the second quarter.