By Sharon Cho
The most likely reason is the kingdom expects a big slowdown in global energy consumption including in Asia where infections are rising quickly, the analysts said. The transition to a probably less friendly U.S. administration may also have led the Saudis to adopt a more supportive stance toward other Middle East producers, they said. Goldman revised its demand forecasts for January and February to 92.5 million barrels a day from 93.5 million in December.
The Saudi output cuts would, however, support prices in the coming weeks, the bank said, as it maintained its year-end Brent forecast of $65 a barrel. The global crude benchmark traded near $54 a barrel in Asia on Wednesday after jumping almost 5% in the previous session.
Goldman said its supply-demand balance for the first quarter is weaker than previously thought and it now sees a 250,000 barrel per day surplus. There are prospects for a tighter market from April to July, however, when it forecasts a 1.3 million barrel deficit.
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COMMENTARY: Canadians Should Decide What to do With Their Money – Not Politicians and Bureaucrats