Oil to Reach $100 on OPEC Capacity Drop, Goldman Says
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A drop in OPEC spare production capacity will signal a “second stage” in the oil market’s recovery, lifting crude higher than $100 a barrel by the second half of 2011, according to Goldman Sachs Group Inc.
The Organization of Petroleum Exporting Countries will supply more oil, reducing its spare capacity, as global inventory levels “normalize” from an overhang cause by the recession, the bank said in its 2011 commodities outlook dated yesterday. The 12-member group, which pumps about 40 percent of the world’s crude, said at a Dec. 11 meeting it will maintain production targets at levels agreed in December 2008.