Oil hitting $100 is becoming a popular forecast among Wall Street analysts as Goldman Sachs became the latest firm to lift its crude target for the next 12 months.
"We have nudged up our 12-month ahead Brent forecast from $93/bbl to $100/bbl as we now expect modestly sharper inventory draws," wrote Daan Struyven, Goldman's head of oil research, and his team.
"The key reason is that significantly lower OPEC supply and higher demand more than offset significantly higher US supply," he added.
West Texas Intermediate (CL=F) rose fractionally on Thursday, hovering above $90 per barrel. Brent crude futures (BZ=F) reached $94 per barrel during the session, just off its 10-month intraday high of $95.95 reached on Tuesday.
Crude futures are up about 30% in the past three months amid a supply crunch created by output cuts from the world's largest oil producers and their allies, OPEC+, along with unilateral reductions from Saudi Arabia and exports constraints from Russia.
Russia needs higher oil prices to keep funding its war with Ukraine while Saudi Arabia needs capital to fund a series of domestic projects in the coming years.
Goldman analysts predict OPEC will be able to maintain prices in the range of $80 to $105 in 2024.
"We also believe that Brent is unlikely to sustainably drop below $80/bbl next year because of the strong OPEC put," wrote Struyven.
Earlier this week, Citi's global head of commodities research Ed Morse said oil could reach $100 per barrel and stay there for a "short while," but points to a pullback amid increased supply from non-OPEC countries like the US, Canada, and Brazil.
"Higher prices in the near term could make for more downside for prices next year," added Morse.
Citi's analysts see oil averaging $84 in the fourth quarter 2023 and moving to the low-$70 range in 2024.
RBC Capital Markets recently raised the possibility of $100 per barrel amid "a momentum-based" market.
“The idea of $100/bbl remains far from a base case scenario for us, but we have learned to respect that this oil market has evolved into as much of a momentum-based market as it is a fundamentally based one when thinking about near dated prices,” analysts Michael Tran and Helima Croft wrote in a recent note to investors.
“It often overshoots and overcorrects," added the analysts.
Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on Twitter at @ines_ferre.