Goldman Bullish on Oil, But Why?

Just like I took the “over” for the Wildcats (70 points) when Arizona faced Illinois in the NCAA Tournament Elite 8 last weekend, I’m going to take the “over” again on the number of energy stocks Goldman Sachs (GS) owns. Today’s $1+ jump in crude prices is being attributed to Goldman’s bullish note today that they see a “super spike” in oil prices on the horizon. Previously, GS had said they thought oil could hit $80 per barrel in such a scenario, but that number was lifted to $105 today, sparking much conversation on the Street.

Call me crazy, but I think the Goldman call had more to do with boosting the stocks they own, rather than some meaningful change in oil fundamentals they saw change overnight. After peaking at $57 or so, oil futures fell $5 fairly quickly in March, leading to a correction in the sector’s shares. By raising their already overly bullish view, this slide would quickly turnaround, stopping the losses from their energy holdings and allowing them to unload some stock at favorable prices if they were so inclined.