Oil slumps on demand woes as Goldman cuts outlook again
BNN Bloomberg
Oil extended losses amid persistent concerns around the demand outlook as Goldman Sachs Group Inc. cut its price forecast again.
Brent futures traded below US$73 a barrel after capping the biggest weekly drop since early May last week. Goldman made its third downward price revision for the global benchmark in six months, trimming its estimate to US$86 for the end of the year on rising supplies and waning demand.
Oil in London is around 15 per cent lower this year as fears of a U.S. slowdown, China's anemic economic recovery and robust Russian crude flows weigh on the outlook. Even a recent pledge by Saudi Arabia to cut more production in July failed to keep prices elevated, with traders less and less responsive. On Monday, Brent's nearest timespread was nearing a flip into a bearish contango structure, which signals oversupply.
