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(Bloomberg) Oil’s collapse to $27 a barrel last week spurred concern that, on top of the existing oversupply, the market is facing a demand crisis. Goldman Sachs Group Inc. thinks that’s wrong.

Over the past six weeks, long-term oil futures — for deliveries in five years’ time — have fallen even harder than prices for immediate supplies. That’s a sign to Jeff Currie, Goldman Sachs’ head of commodities research, that the latest rout wasn’t driven by fading oil consumption. When demand is weak, that gap — or timespread — would widen rather than narrow, he says. “Recent price declines are not demand driven, but rather driven by structural supply forces,” he said. “Time-spreads in Brent and oil products have strengthened, not weakened, and weakening time-spreads are characteristic of demand-driven price declines.”

So if a demand shock wasn’t the culprit, then what did push prompt crude to its lowest in more than a decade? It’s still comes down to excess supply, according to Currie. Meanwhile, longer-term prices have slumped for other reasons, most notably producers hedging sales, and some consumers choosing to abandon their own safeguards against higher prices.

The pressure from low prices is already causing “binding constraints on the oil market,” straining producers’ ability to both access capital and finance their daily operations, Goldman says. That will ultimately lead crude markets to a “new equilibrium,” which Goldman has previously forecast will mean the emergence of a new bull market.

“We’re now in the right zip code in terms of prices that are creating the adjustment process,” he said.

Still, the re-balancing process will be “both protracted and arduous,” with prices swinging between $20 and $40 a barrel throughout the first half before order is restored, Currie predicts.