Reuters is reporting investment bank Goldman Sachs take on the oil markets-
- The historical lag between prices and rig response suggests that drilling may be about to surge in coming weeks.
- Beyond the headline rig count, we find that it is the IG producers that have continued to steadily increase their drilling... private producers still lagging.
- The expectation for strong oil demand growth and high OPEC compliance, we reiterate our constructive forecast on oil prices with global inventories set to fall further below their 5-year average levels through 3q18".
- The restraint exhibited by producers so far leaves us comfortable with our 1.1 MB/d us crude oil production growth forecast for 2018".
- US shale oil drilling response has started, although the increase in the rig count remains modest so far.
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