• GCC Nations To Reap Windfall If Oil Prices Rise


    June 19 (Reuters) - Gulf Cooperation Council (GCC) countries and Russia could enjoy large windfalls if oil prices rose to as much as $63 per barrel this year and $90 next year, Goldman Sachs analysts said, adding they saw brighter prospects for the Gulf Arab nations when compared with Russia. Goldman's commodities research analysts have raised their oil price forecasts to $63/bbl from $50.5/bbl for 2009, and expect prices to reach $90/bbl in 2010, given intensifying supply constraints in the hydrocarbon sector and a likely return of demand.
    While the six-member GCC and Russia are both battling the current downturn, Russia is at a much less favourable spot to gain from a return of the petrodollars, Goldman said.
    "We argue that the severe recession there has been more the result of deleveraging than the direct impact of lower commodity prices," Goldman added.
    Prospects for the Gulf Arab nations are brighter even as the strength of recovery may vary between countries, it said.
    A sustained oil price recovery would propel the more robust economies of Saudi Arabia and Qatar, while the more leveraged United Arab Emirates and Kuwait should take longer to rebound, Goldman said.
    "It is likely that the (GCC) region as a whole will once again re-emerge as a leading capital exporter," Goldman said.
    As for Russia, "this oil blessing" may push its ruble higher and aid the recovery in asset prices but would not make a significant difference to real growth in 2009, they added.

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