(Bloomberg) --

Goldman Sachs Group Inc. has raised its expectations for Saudi Arabia’s oil production and economic growth as crude prices rise well over $70 a barrel.

The bank’s Middle East and North Africa economist Farouk Soussa lifted his assumptions for Saudi oil production by around 500,000 barrels per day, to reach 10 million barrels by the end of 2021 and 10.5 million in 2022. That -- combined with the release of favorable non-oil growth data on Monday -- pushed Goldman to boost its growth forecast for gross domestic product to 4.5% this year, compared to an earlier 2.5%.

“We see risks to the oil sector as being significantly skewed to the upside,” Soussa wrote in a research note on Tuesday, adding that domestic demand has “recovered strongly.”

The bank sees the economy of the world’s largest crude exporter expanding a further 7% in 2022, compared to a 5.7% forecast previously, followed by an unchanged 1.2% growth rate in 2023 and 2024, he wrote. Brent crude was trading at over $73 a barrel on Tuesday, compared to an average price of around $61 in the first quarter.

The kingdom pumped just under 8.5 million barrels of crude a day in May and is expected to raise output to 9.5 million daily by July as OPEC eases supply cuts. The cartel, of which Saudi Arabia is the effective leader, is under pressure to increase production further as the oil market tightens with major economies reopening.

READ MORE: Saudi Non-Oil Economy Rebounded to 2.9% Growth in First Quarter

©2021 Bloomberg L.P.