Goldman's Murti, super-spike predictor, sees oil tfrom Reuters:
* Analyst called 'super spike' to $150-$200/bbl in 2008
* Says prices need to rise to ration demand
* Sees 'huge draws' in inventories
NEW YORK, Oct 14 (Reuters) - The Goldman Sachs equity analyst whopredicted oil prices would spike to $150-$200 a barrel three years agosaid on Friday the market is showing 'stark similarities' to the startof the 2007-2008 bull run.
Arjun Murti, Goldman's <GS.N>top energy equities analyst in New York, said that falling inventoriesand disappointing supply growth had left the oil market "extremelytight" and it is likely prices will climb higher.
"The physicalmarket suggests that the current environment for oil looks very similarto the 2007 bull market that led to demand rationing prices in the firsthalf of 2008," Murti said in a note to clients that was coauthored withLondon-based analysts Michelle della Vigna and Henry Morris.
"Disappointing supply, decent demand, huge draws in inventories andlimited spare capacity are all common factors. We are currently in thetightest physical market we have experienced since the end of2007/beginning of 2008."
In 2005 Murti was one of the firstanalysts to predict oil prices would one day hit $100 a barrel, analmost unthinkable level at a time when prices averaged $57 a barrel forthe year. He was proved right three years later.
The New Jerseynative, who has described himself in the past as 'anti-oil', went on tomake his 'super spike' $150-$200 a barrel call in May 2008, when priceswere around $115.
Brent crude prices <LCOc1> wouldeventually peak at $147.50 a barrel in July 2008, but he was stung bycriticism after prices collapsed in the second half of that year.
In Friday's note, Murti stopped short of forecasting how high prices might rise.
Goldman Sachs' commodity research team, which forecasts prices forindividual raw materials, sees Brent crude oil <LCOc1> averaging$120 a barrel in 2012. Brent is on course to average more than $100 forthe first time ever this year.
Some energy traders said Murti'sbullish view was supporting a strong rally in Brent crude on Friday.Prices were up almost $3.50 at $114.50 by early afternoon in New York,and have climbed almost 15 percent since briefly dipping below $100 abarrel 10 days ago.
HOW TIGHT IS THE MARKET?
Murti saidthat inventories of oil in developed countries have fallen sharply in2011, influenced by supply outages in Libya and buoyant demand.
"The latest inventory data from Europe, the U.S. and Japan suggeststotal inventories are now 31 million barrels below their five-yearseasonal average, and in absolute terms crude inventories are back attheir 2006 levels," Murti said, adding stocks would be even lower if itwere not for the International Energy Agency's emergency fuel releaseover the summer.
"This reflects a global market in deficitdespite Saudi producing the highest amount of crude since the 1980s andshows stark similarities to the 2007 bull market that led to demandrationing prices."
Murti, said that demand in the United States,the world's largest oil consumer, had not yet been curbed substantiallyby higher prices this year, suggesting they could have further to climb.
"We continue to believe the imbalances between global oil demand andsupply will only be corrected by price incentivized demand destruction,likely driven at first by the United States," Murti said.