Goldman Sachs Forecasts Stable Brent Crude Prices Amid Global Uncertainties

Goldman Sachs has reaffirmed its Brent crude oil price forecasts, projecting an average of $64 per barrel in the fourth quarter of 2025 and $56 in 2026. The investment bank highlighted both potential upward and downward risks that could influence these estimates, citing geopolitical tensions, economic indicators, and production decisions by the Organization of the Petroleum Exporting Countries and its allies (OPEC+).

On the supply side, Goldman Sachs pointed to increased pressure on Russian and Iranian oil exports due to sanctions as a potential factor that could drive prices higher. Additionally, a faster-than-expected reduction in global spare capacity may contribute to upward price pressures. Despite these concerns, the bank assesses the risk of significant disruptions in Russian oil supply as limited, noting continued imports by China and India. However, Indian state refiners have recently reduced purchases due to narrowing discounts and U.S. political pressure.

Conversely, the bank identified several downside risks that could temper oil demand growth, which is forecasted at 800,000 barrels per day annually for 2025-2026. These include weak U.S. economic indicators, higher U.S. tariffs, and potential new trade barriers. Goldman Sachs economists noted that U.S. economic growth has fallen below potential, raising the likelihood of a recession in the next 12 months.

In the realm of production decisions, OPEC+ announced a 547,000 barrels per day increase in production for September. Goldman Sachs anticipates that OPEC+ will hold quotas steady thereafter due to rising OECD stockpiles and waning seasonal demand.

As of early Monday, Brent crude was trading at $69.27 per barrel, while West Texas Intermediate (WTI) stood at $66.96 per barrel.

The interplay between these factors underscores the complex dynamics influencing global oil markets. Investors and market participants are advised to monitor geopolitical developments, economic indicators, and production decisions closely, as these elements collectively shape the trajectory of oil prices.