Goldman Sachs warns oil prices on the brink of 'capitulation'

Brent crude fell 10% last week

After falling to their lowest levels since OPEC agreed to cut production back in November last year, Goldman Sachs has warned oil prices are nearing "capitulation".

The firm said its 2017 forecast of $50 a barrel for Brent crude now faced a clear "downside risk" as US shale production continued to increase.  The price of Brent crude fell 10% to as low as $46.64 a barrel last week, its lowest level since November as traders became impatient with OPEC's attempts to force a return to higher oil prices. In the researh note entitled Oil Nearing Capitulation, Goldman Sachs said there was "growing evidence of the ability of US shale to respond near $50 per barrel and the availability of capital to support such activity", according to MarketWatch. Sau...