Goldman Sachs Maintains View That Oil Will Top Record This Year

By Juan Pablo Spinetto and Grant Smith

Aug. 20 (Bloomberg) -- Goldman Sachs Group Inc. repeated its forecast that crude oil prices will rebound to $149 a barrel by the end of the year as supply growth struggles to keep pace with demand from emerging markets.

Goldman maintained its forecast even after oil futures slid $30 from their July 11 record of $147.27 a barrel. Fundamentals of supply and demand are still more important in setting oil prices than investor flows linked to movements in the U.S. dollar, Goldman added.

``We expect declining trend oil supply growth and supportive emerging markets oil demand growth to continue to offset demand weakness'' in developed economies, London-based Goldman analyst Jeffrey Currie said in a report.

Prices will be supported by a combination of disappointments in production outside the Organization of Petroleum Exporting Countries, this month's supply disruption in the Caspian Sea and the absence of any increase in consumers' oil stockpiles during the second quarter, when inventories normally rise, Goldman said.

To contact the reporter on this story: Juan Pablo Spinetto in London at jspinetto@bloomberg.netGrant Smith in London at gsmith52@bloomberg.net