Goldman Sachs on Oil

We maintain our base case that continued adaptation of Mideast supply will eventually reduce crude oil prices, while potential renewed escalation still poses significant net upside risk. We nudge up our Brent Dec26 price forecast to $90/bbl (vs. $85 prior) because ongoing downside risks to supply likely slow the moderation in the timespreads risk premium—which we estimate at just over $20 today. Our 2027 average Brent forecast of $80 is unchanged and balances downward price pressure from faster-than-expected adaptation in Gulf supply against a slower moderation in the risk premium. We forecast WTI prices, which are unusually low vs. Brent because of high US-Europe shipping costs, to average $81 in Dec26 and $73 in 2027. Why prices remain high. We estimate that Persian Gulf oil exports, including estimated dark exports, have recently recovered to their 2025 average and that the global market was roughly balanced in September. Prices remain high because downside risks to supply, low stocks, and the high sensitivity of interest rates to oil prices are driving strong oil demand for physical restocking and financial hedging.