Oil prices are poised to spike in 2024 after a significant pull back that surprised the market last year, according to the former head of commodities research at Goldman Sachs. “It is the most investable space out there in the economy right now,” Jeff Currie told CNBC’s ” Squawk Box ” on Thursday. “The return on capital employed exceeds 20% in many parts of the world if this is the low point, and we’re underinvested going forward.” Currie pointed to expectations that the Federal Reserve will slash rates in 2024. He said commodities spike every time the central bank cuts in the late cycle. Crude surged $10 a barrel when the Fed cut rates in September 2007, Currie said. The central bank indicated last month it sees three rate cuts this year. “I don’t care how bearish you get on fundamentals this year — if you see the Fed cut you don’t want to be short commodities,” Currie said. West Texas Intermediate futures fell nearly 11% in 2023 as bearish sentiment overtook the market on worries that supply was increasing while demand was faltering. U.S. crude was last trading at $72.84 a barrel, up 14 cents, or 0.2% from the previous session. @CL.1 1Y mountain WTI in past year But Currie said the drop in crude prices had little to do with demand. Rather, it was the result of a “one-off increase in supply” that the market will absorb, he said. Politicians in the West pulled every lever available to fight inflation last year, easing environmental policy and turning a blind eye to oil sanctions on Iran, Russia and Venezuela, he said. As they let up on sanctions, more than 1 million barrels per day of crude entered the market, he said. “It debottlenecked the system, created excess supply, and put downward pressure on commodities,” said Currie. He expects Western governments to flip the script in 2024 and focus on green policy and sanctions again as voters see relief from inflation. “It wasn’t created by investment or slow down in demand,” Currie said of the price drop. “It was created by a one-off increase in supply that the system can either absorb, or that one-off increase in supply goes away.”