SINGAPORE: Sachs has raised its Brent crude price forecast for 2011 and 2012 on expectation fuel demand growth will sap global inventories and strain OPEC's spare oil output capacity. The Wall Street bank, seen as one of the most influential in commodity markets, said it was "structurally bullish" on oil and raised its year-end Brent forecast to $120 per barrel from $105 a barrel, and its 2012 forecast to $140 from $120. Goldman's bullish tone comes just a month after the bank 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."
