Brent could rally above $75 if Saudi outage extends beyond six weeks: Goldman Sachs

Goldman Sachs said an outage of more than six weeks due to drone attacks on Saudi Arabian oil facilities over the weekend could cause Brent prices to rally above $75 a barrel, although the magnitude of the impact was uncertain at this point.

A disruption over such a duration at current levels would not only push up Brent prices, but also result in the release from Strategic Petroleum Reserves "large enough to balance such a deficit for several months and cap prices at such levels," the Wall Street bank said in a note dated Sunday.

Oil prices surged on Monday, with global benchmark Brent crude posting its biggest intra-day percentage gain since the Gulf War in 1991, after the attack on Saturday shut over 5% of global supply.

Listing out other scenarios dependent on the actual duration of the outage, analysts at the bank said a very short, or about week-long outage, could push prices up by $3-$5 a barrel, while a disruption of two to six weeks would result in a $5 to $14 per barrel move.

"An extreme net outage of a 4 mb/d (million barrels per day) for more than three months would likely bring prices above $75/bbl to trigger both large shale supply and demand responses."

Meanwhile, British bank Barclays said the attacks are unlikely to reduce Saudi Arabia's oil exports dramatically since it holds a significant amount of crude oil and petroleum products in storage.