The cost of crude oil has been pushed up by a forecast from analysts at Goldman Sachs on future prices.
The Wall Street bank, seen as one of the most influential in commodity markets, said it was “structurally bullish” on oil.
They said Brent crude should hit $130 a barrel in a year’s time based on demand from economic growth which will eat into stockpiles and OPEC’s spare capacity.
This comes just a month after Goldman rocked markets in April by calling a nearly $20 fall in Brent, saying speculators had pushed prices ahead of fundamentals.
“It is only a matter of time until inventories and OPEC spare capacity will become effectively exhausted, requiring higher oil prices to restrain demand, keeping it in line with available supplies,” Goldman analysts said in a report dated Monday.
“We expect that the ongoing loss of Libyan production and disappointing non-OPEC production will continue to tighten the oil market to critically tight levels in early 2012.”
Goldman also recommended buying other commodities including copper and zinc saying demand will pick up.