Goldman Sachs Predicts Brent Crude Oil Prices to Drop Below $60 by 2026

Goldman Sachs has projected that Brent crude oil prices will decline to the low $50s per barrel by late 2026, a significant decrease from current levels. This forecast is based on an anticipated surplus in global oil supply and evolving market dynamics.

As of August 27, 2025, Brent crude is trading around $67 per barrel. The investment bank attributes the expected price decline to several factors, including a projected average surplus of 1.8 million barrels per day from the fourth quarter of 2025 through the fourth quarter of 2026. This surplus is anticipated to result in an increase of approximately 800 million barrels in global oil stocks by the end of 2026. Notably, about one-third of this stockpile is expected to be stored in OECD countries, where weakening demand is also contributing to the downward pressure on prices.

Increased production from non-OPEC countries is a significant contributor to the anticipated surplus. Nations such as the United States, Canada, Brazil, and Guyana are expected to boost their oil output. The U.S. Energy Information Administration forecasts that U.S. crude oil production will average 13.59 million barrels per day in 2025. Additionally, advancements in renewable energy adoption are projected to reduce global demand for fossil fuels, further influencing the decline in oil prices.

Other financial institutions have also adjusted their oil price forecasts in light of these developments. Barclays has lowered its Brent crude estimates by $4 to $66 per barrel for 2025 and by $2 to $60 per barrel for 2026, citing OPEC+'s accelerated output hikes. HSBC has reduced its Brent crude oil price forecasts to $68.5 per barrel for 2025 and $65 per barrel for 2026, following the announcement of tariffs by U.S. President Donald Trump and OPEC+'s decision to increase production. J.P. Morgan maintains a forecast of $66 per barrel for 2025 and $58 per barrel for 2026, emphasizing supply-demand dynamics and trade policy developments.

The anticipated decline in oil prices could have widespread implications. For the global economy, lower oil prices may benefit oil-importing countries by reducing energy costs, potentially stimulating economic growth. Conversely, oil-exporting nations could face revenue shortfalls, impacting their economies. In the energy sector, oil companies may need to adjust their investment strategies, potentially delaying exploration and development projects. Investors are concerned that major oil companies like Exxon Mobil and Chevron may reduce shareholder returns through dividends and share buybacks due to declining oil prices. Lower energy prices can also lead to reduced inflation rates, affecting monetary policies worldwide.

Historically, oil prices have experienced significant fluctuations. For instance, during the 2010s oil glut, prices fell below $30 per barrel due to oversupply and reduced demand. The current forecasted decline, while substantial, is not unprecedented.

In conclusion, Goldman Sachs' projection of Brent crude oil prices declining to the low $50s by late 2026 reflects anticipated shifts in global supply and demand dynamics. This forecast aligns with similar projections from other financial institutions and suggests significant implications for the global economy, energy markets, and inflation rates.