Goldman Sachs raises oil price forecast on geopolitical supply risks

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Goldman Sachs oil price forecast

Highlights

Goldman Sachs raises its December Brent crude forecast to $105 per barrel from $90 and WTI to $94 per barrel amid heightened geopolitical risks.
The bank lifts its 2027 average price forecast to $88 per barrel for Brent and $78 for WTI, up from $80 and $73 respectively.
Goldman incorporates a 1 million barrel-a-day disruption allowance into its 2027 base case, reflecting persistent supply risks from ongoing conflicts.

Revised outlook for December and 2027 prices

As reported by CNBC, citing Goldman Sachs in a note led by strategist Daan Struyven, the bank is raising its oil price forecasts for December and for 2027 because it sees a high risk of supply disruption from the Russia-Ukraine war and conflict in the Middle East.

The bank says markets are pricing in a higher risk premium, with many traders expecting a lasting diplomatic breakthrough to be difficult. Goldman adds that broader geopolitical fragmentation is also increasing the risk of disruption, while the timing and location of any supply shock remain hard to predict.

Goldman raises its December forecast for Brent crude to $105 a barrel from $90, and sets its December forecast for WTI crude at $94 a barrel. It also lifts its 2027 average forecast to $88 a barrel for Brent and $78 a barrel for WTI, from $80 and $73, respectively.

Conflict-driven risks reshape oil market assumptions

The revised forecast underscores how ongoing conflicts are continuing to shape expectations across global energy markets. By adding a 1 million barrel-a-day disruption allowance to its 2027 base case, Goldman is signaling that supply risk is becoming a more central part of long-term oil pricing assumptions.

For the energy sector, the higher forecast points to sustained volatility as traders weigh geopolitical developments against the prospect of constrained supply. The change also suggests that, in Goldman’s view, oil prices are likely to remain supported if diplomatic progress in key conflict zones stays limited.

In our earlier article on the WTO’s warning about lasting trade impacts from the wars in Ukraine and the Middle East, we noted that repeated disruptions are pushing companies to redesign supply chains and shipping routes for resilience, even at higher cost. The WTO also pointed to sharp declines in Middle East trade flows and argued that a more fragmented geopolitical environment could keep reshaping global commerce even after fighting subsides.

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