According to a report from Reuters, Goldman Sachs expects Brent crude prices to average around $90 a barrel in the fourth quarter of 2026.
- The bank said that the impact of disruptions in the Strait of Hormuz has been mitigated by weaker demand and pre-existing oversupply.
- Goldman also warned that oil price outcomes depend on geopolitical developments, and a faster supply normalization and softer demand could push Brent to around $70 in late 2026 and $60 in 2027.
- Meanwhile, prolonged export disruptions could lift Brent above $110 in late 2026, and an extended Hormuz disruption could send prices as high as $140 per barrel in 2027, the bank said.
Goldman Sachs has reportedly lowered its 2027 price target on oil, predicting a drop to $80 per barrel.
According to a Reuters report, the bank said on Thursday that stronger supply growth and ongoing demand weakness contributed to its forecast revision, although it warned that prices could swing sharply depending on the geopolitical environment.
The bank continues to expect Brent crude prices to average around $90 a barrel in the fourth quarter of 2026.
Oil Prices: Supply Growth Offsets Hormuz Risks
As per the report, Goldman noted that rising output from the United States, Brazil, Guyana, Venezuela and the UAE, combined with structural demand shifts, particularly in China, would likely keep downward pressure on oil prices over the long term despite ongoing geopolitical risks in the Middle East.
Despite the Q4 projections, it noted that the impact of disruptions in the Strait of Hormuz has been mitigated by weaker demand and pre-existing oversupply, limiting the global supply deficit to about 5–6 million barrels per day in the second quarter.
“We now assume that oil exports from Gulf producers normalize by late August (vs. by late June prior), which may be achieved with a rise in Hormuz flows to 70% of pre-war levels given current redirections,” the bank reportedly said.
Goldman’s Crude Outlook
However, the bank warned that outcomes remain highly dependent on geopolitical developments. In a downside scenario, faster supply normalization and softer demand could push Brent to around $70 in late 2026 and $60 in 2027.
Conversely, prolonged export disruptions could lift Brent above $110 in late 2026, while an extended Hormuz disruption could send prices as high as $140 per barrel in 2027.
Oil Prices Retreat As Trump Signals Progress On Iran Talks
At the time of writing, oil prices were headed lower after U.S. President Donald Trump said in a post on Truth Social on Thursday that he called off a third consecutive day of strikes on Iran, adding that a deal with Tehran was close to being finalized and a “time and place of the signing would be announced shortly.”
Brent crude futures expiring in August fell more than 2% to trade at around $88.46 a barrel, while WTI crude futures expiring in July declined about 1.90%, trading around $86 a barrel.
The United States Oil Fund (USO), which tracks the price of WTI crude, was down 0.5% at the time of writing amid “bullish” sentiment. The ProShares Ultra Bloomberg Crude Oil (UCO) fell nearly 2% in the overnight session.
Meanwhile, the SPDR S&P 500 ETF (SPY), which tracks the S&P 500 index, was down 0.23% at the time of writing, and the Invesco QQQ Trust ETF (QQQ) fell more than 0.70%. The SPDR Dow Jones Industrial Average ETF Trust (DIA) was trading flat.
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