Goldman Sachs: oil price sell-off due to concerns of excess supply in 2019 - Reuters News

Omkar Godbole FXStreet Contributor

The sharp sell-off is likely a result of growing concerns that supplies would exceed demand in 2019, according to Goldman Sachs.

Key points (Source: Reuters)

Technical positioning factors are exacerbating volatility.
Fall in oil prices also reflects low trading liquidity ahead of Thanksgiving, broader cross-commodity and cross-asset sell-off, as growth concerns continue to mount.
Expects high price volatility until evidence that oil market fundamentals are improving, requiring a decline in OPEC production, signs that demand growth is resilient.
Recovery in prices will require that the Brent forward curve returns into backwardation from its sudden and significant flattening.

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

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