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Goldman Sachs raised its forecast for the oil market in 2021 as the economy starts to recover.

Goldman Sachs raised its forecast for the oil market in 2021 as the economy starts to recover, according to Markets Insider.

The investment bank believes demand for oil will rebound due to the "rising likelihood of widely available vaccines" this spring.

The forecast states that Brent oil will rally to $65 per barrel from $45 per barrel by quarter 3 of 2021. Analysts expect Brent to finish 2021 around $58.

West Texas Intermediate crude is forecasted to rally to $55.88 from $51.38. "Key to the resilience of spot prices, despite stalling inventory draws this summer, has been the steady rally in long-dated prices," Goldman Sachs said on August 30.

Furthermore, long positions in Brent would provide an "effective portfolio hedge" against uncertainty. "There is a growing likelihood that vaccines will become widely available starting next spring, helping support global growth and oil demand, especially jet."

Demand for oil is expected to increase by 3.7 million barrels per day from January-August.

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