Goldman Cuts 2027 Brent Forecast on Weaker Fundamentals; Still Sees $90 for Q4 2026

Goldman Sachs on Thursday lowered its average 2027 oil price forecast by $5 to $80/bbl due to weaker demand combined with higher expected supply from both the United Arab Emirates as well as producers in the Americas including the U.S., Venezuela, Guyana and Brazil.

The U.S. investment bank in a note kept its 2026 fourth-quarter Brent estimates at $90/bbl, citing a smaller-than-expected deficit from the Strait of Hormuz disruption and lower chances of a long-term disruption.

Goldman now forecasts a 5 million-6 million b/d global oil market deficit for Q2, which is smaller than the loss of around 14 million-15 million b/d of Middle East liquids production during the period. This is because of the estimated world demand losses of nearly 5 million b/d as well as an over 4 million b/d oversupply that had existed prior to the Mideast conflicts, it said.

The bank’s forecasts are based on its assumption that oil exports from Persian Gulf producers will normalize by late August, meaning oil flows through the strait would rise to 70% of pre-conflict levels at that time given current re-directions by pipelines.

For 2027, Goldman now expects an average Brent price of $80/bbl, down from its previous forecast of $85/bbl, lifted by stronger supply from the U.A.E. following its OPEC exit and higher output from Americas producers.

The bank gave two reasons for its current 2027 oil price forecast to exceed its 2025 average, despite a global oil market surplus next yearn of over 3 million b/d.

“First, OECD commercial oil stocks are unlikely to reach very high levels following sharp 2026 draws and over 1 million b/d of global strategic stockpiling in 2027. Second, a security premium compensating for disruption risk is likely to keep a floor under prices,” Goldman said.

In addition, the bank said demand should “largely bounce back” after Mideast oil flows normalize, with only 10% of this year’s demand weakness persisting into 2027, as China is expected to accelerate its switch to non-petroleum fuel like electric vehicles.

Most analysts expect global oil supplies to rebound on signs of a Mideast peace deal, an increase in Iranian supply after a possible removal of U.S. sanctions and long-term oversupply.

Reporting by Frank Tang, ftang@opisnet.com; Editing by Michael Kelly, mkelly@opisnet.com