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OPEC+ production cuts might support oil rates in near term, Goldman Sachs states

Crude production from Iraq, Kazakhstan, and Russia has declined in compliance with OPEC+. production cuts, supporting a modest near term advantage to Brent. rates, Goldman Sachs stated.

Saudi Arabia is most likely to extend oil production cuts. because of the recent rate drop and we now believe that oil. production cuts will last till April 2025 rather of January,. the investment bank said in a note dated Tuesday.

Goldman Sachs kept its typical Brent rate forecast. for 2025 at $76 per barrel. OPEC+, that includes members of the OPEC and allies such as. Russia, is going over a further hold-up to a planned oil output. trek that was due to start in January, two sources from the. group said. At its most recent meeting on Nov. 3, OPEC+ agreed. to delay a prepared December output increase by a month.

Any ramp-up in OPEC+ production will be gradual and. data-driven, the bank stated.

Goldman added that rising compliance with OPEC+ production. cuts suggests that the group's member countries are working. together to support oil prices.

Production from Iraq, Kazakhstan, and Russia decreased by 0.5. million barrels per day in November, Goldman stated. OPEC member countries are unlikely to unwind voluntary. production cuts in the short term, executives of international. product trading giants Vitol, Trafigura and Gunvor said at the. Energy Intelligence Online Forum in London.

However, in spite of OPEC+'s production cuts and hold-ups to. output hikes, Brent futures have actually mainly stayed in a. $ 70-$ 80 range this year, and were trading below $74 on Tuesday. Recently, Goldman Sachs revised Brent prices to typical around. $ 80 per barrel this year, despite a 2024 deficit and. geopolitical unpredictability, citing an awaited surplus in 2025.

(source: Reuters)