Investing.com – Crude oil futures extended gains on Tuesday, recouping nearly all of Monday’s losses after Goldman Sachs raised its oil-price forecast and recommended buying the commodity, while a weaker U.S. dollar also lent support.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in July traded at USD99.47 a barrel during U.S. morning trade, rallying 2%.
It earlier rose by as much as 2.35% to a daily high of USD99.81 a barrel.
Influential Wall Street investment bank Goldman Sachs raised its 2011 and 2012 oil-price forecast, saying the continued absence of Libyan crude exports and disappointing production from nations outside the Organization of Petroleum Exporting Countries will tighten inventories and exhaust spare OPEC capacity.
"We believe that the market will continue to tighten to critical levels by 2012, pushing oil prices substantially higher to restrain demand," Goldman said in a report late Monday.
The investment bank projected oil prices would average USD130 a barrel in 2012, up from a previous estimate of USD105 a barrel. The bank added that the recent pullback in oil markets provided a "good entry point for long positions in crude oil."
Meanwhile, weakness in the dollar had also contributed to oil’s strength. The dollar index was down 0.28% to hit 76.08, retreating from a seven-week high. Dollar-denominated oil futures contracts tend to rise when the dollar falls, as this makes oil cheaper for buyers in other currencies.
Markets were also awaiting fresh information on U.S. stockpiles of crude and refined products. The American Petroleum Institute will release its inventories report later in the day, while Wednesday’s government report could show stockpiles declined by 1.6 million barrels last week.
Elsewhere, on the ICE Futures Exchange, Brent oil futures for July delivery jumped 2.12% to trade at USD112.25 a barrel, up USD12.78 on its U.S. counterpart.
Global financial service provider Morgan Stanley raised its 2011 Brent crude forecast to USD120 a barrel, up 20% from a previous estimate.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in July traded at USD99.47 a barrel during U.S. morning trade, rallying 2%.
It earlier rose by as much as 2.35% to a daily high of USD99.81 a barrel.
Influential Wall Street investment bank Goldman Sachs raised its 2011 and 2012 oil-price forecast, saying the continued absence of Libyan crude exports and disappointing production from nations outside the Organization of Petroleum Exporting Countries will tighten inventories and exhaust spare OPEC capacity.
"We believe that the market will continue to tighten to critical levels by 2012, pushing oil prices substantially higher to restrain demand," Goldman said in a report late Monday.
The investment bank projected oil prices would average USD130 a barrel in 2012, up from a previous estimate of USD105 a barrel. The bank added that the recent pullback in oil markets provided a "good entry point for long positions in crude oil."
Meanwhile, weakness in the dollar had also contributed to oil’s strength. The dollar index was down 0.28% to hit 76.08, retreating from a seven-week high. Dollar-denominated oil futures contracts tend to rise when the dollar falls, as this makes oil cheaper for buyers in other currencies.
Markets were also awaiting fresh information on U.S. stockpiles of crude and refined products. The American Petroleum Institute will release its inventories report later in the day, while Wednesday’s government report could show stockpiles declined by 1.6 million barrels last week.
Elsewhere, on the ICE Futures Exchange, Brent oil futures for July delivery jumped 2.12% to trade at USD112.25 a barrel, up USD12.78 on its U.S. counterpart.
Global financial service provider Morgan Stanley raised its 2011 Brent crude forecast to USD120 a barrel, up 20% from a previous estimate.