Investing.com – According to McClellan Financial Publications, oil prices are expected to reach their lowest point in the coming months. Using an analysis that compares 19.8-month adjusted gold price trends with those of crude oil, the firm suggests that movements in gold predict fluctuations in the oil market after that specific interval.
While this model is not perfect—as demonstrated by variations caused by geopolitical events such as Russia’s invasion of Ukraine—it generally returns to a reliable historical correlation after such divergences. “We expect oil prices to find a bottom in mid-2024, followed by a rally later in the year,” states the McClellan Market Report.
The analysis adds that an already observed increase in gold prices could signal a subsequent increase in oil prices, with a delay of 19.8 months. This potential increase could have political implications, especially for federal politicians seeking re-election in November.
At the end of 2023, crude oil fell earlier than forecasts based on gold prices indicated. However, since then, prices have realigned to the expected pattern, reinforcing the validity of the model used.
The forecast indicates that the next market low point should ideally occur around June or July 2024. However, it is important to consider that these inflection points may vary slightly in terms of timing.
“As summer approaches, we should monitor other indicators to identify signs that oil price bottoms are near or that a recovery is underway,” the report concludes.
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OPEC likely to extend oil production cuts in June, Goldman predicts
Goldman Sachs (NYSE:) analysts updated their forecasts for OPEC+ oil production, indicating on Thursday that they no longer expect the group to reverse recent voluntary production cuts in June. Instead, they project Saudi Arabia’s production to remain at 9 million barrels per day in July, adjusting the previous estimate of 9.2 million barrels per day.
Three main factors motivated this revision in expectations. Firstly, recent data on inventories exceeded projections, decreasing the probability of a production increase in June to just 37%. Furthermore, analysis of data on adherence to production cuts suggests that Saudi Arabia’s continued reduction of 1 million barrels per day, part of a broader cut of 2.2 million barrels per day, could maximize profits. of Saudi oil in the short term.
Furthermore, rising interest rates have reinforced the importance of these profits to finance Saudi Arabia’s ambitious investment plans. However, analysts highlight that there is still substantial spare capacity, which maintains the possibility of a modest increase in future production.
Recently, following an announcement from the United Arab Emirates about increasing its capacity, Goldman Sachs raised its estimate of global spare capacity to 6.5 million barrels per day, up from 6.2 million.
Regarding prices, analysts see the impact of the reduction in OPEC+ production as positive for spot oil prices relative to long-term prices. However, they maintain the projection that the average price will be US$82 per barrel in 2025, considering low stock levels and idle capacity that should limit prices in the long term.
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Brent should remain between US$75 and US$90 in most scenarios, according to Goldman Sachs, which also points to geopolitical risks to OPEC’s ability to mobilize spare capacity as the main upside risk for oil prices. while high idle capacity can pose downside risks to group cohesion.
At 1:05 pm Brasília this Friday, the 10th, the barrel of Texas (), a reference in the USA, fell 0.68%, to US$ 78.71, while Brent, a global reference and for Petrobras (BVMF:), fell 0.72% to US$83.28.
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