Oil & Gas

Goldman Sachs has increased its oil price outlook for the fourth quarter, projecting Brent crude at $90 per barrel and U.S. West Texas Intermediate (WTI) at $83. The revision reflects reduced oil output from the Middle East, which is tightening global supply conditions.

According to analysts led by Daan Struyven, the broader economic risks extend beyond their base-case oil assumptions. They highlighted upward pressure on oil prices, unusually high refined product costs, potential shortages, and the exceptional magnitude of the current supply shock as key concerns.

The updated forecast assumes that Gulf oil exports through the Strait of Hormuz will normalize by the end of June, slightly later than earlier expectations of mid-May, alongside a slower recovery in regional production. Goldman Sachs estimates that Middle East supply disruptions of 14.5 million barrels per day are causing global inventories to decline at a record pace of 11–12 million barrels per day in April.

Looking ahead, the bank expects the global oil market to shift dramatically—from a surplus of 1.8 million barrels per day in 2025 to a deficit of 9.6 million barrels per day in the second quarter of 2026. Meanwhile, rising refined product prices are projected to reduce global oil demand by 1.7 million barrels per day in Q2 and by 100,000 barrels per day in 2026. Analysts cautioned that such steep inventory declines are unsustainable, and if supply disruptions persist, even greater demand reductions may be necessary.