Goldman Sachs raised its oil price forecasts for the fourth quarter, projecting Brent crude at $90 per barrel and U.S. West Texas Intermediate (WTI) at $83, citing reduced Middle East output and a slower recovery in production.
Moreover, the bank adjusted its assumptions on Gulf exports through the Strait of Hormuz, now expecting normalization by the end of June instead of mid-May. As a result, it also revised expectations for regional supply recovery.
“The economic risks are larger than our crude base case alone suggests because of the net upside risks to oil prices, unusually high refined product prices, product shortages risks, and the unprecedented scale of the shock,” GS analysts led by Daan Struyven said in an April 26 note.
Supply shock drives sharp inventory draws
Goldman Sachs estimated Middle East crude production losses at 14.5 million barrels per day, which it said pushed global oil inventories into record draws of 11 to 12 million bpd during April.
However, the bank warned that the supply disruption could create broader economic strain due to elevated refined product prices and increasing shortage risks.
Deficit outlook shifts market balance
Goldman Sachs forecast the global oil market will swing from a 1.8 million bpd surplus in 2025 to a 9.6 million bpd deficit in the second quarter of 2026. Additionally, it expected global oil demand to decline by 1.7 million bpd in Q2, before easing to a 100,000 bpd drop in 2026 on an annual basis.
“Because extreme inventory draws are not sustainable, even sharper demand losses could be required if the supply shock persists longer,” the analysts said.
