Goldman lowers oil forecasts, citing slow US growth and OPEC+ policy
Goldman Sachs Group Inc. reduced its oil price projections as tariffs dampened the prospects for US growth while OPEC and its partners increased supply. The move comes as petroleum prices fell from this year’s peak in January due to abundant supply, a dismal demand outlook from China’s leading importer, and an expanding international trade conflict.
“While the $10 per barrel selloff since mid-January is greater than the change in our base case fundamentals, we reduce our December 2025 Brent forecast to $71,” Goldman analysts, including Daan Struyven, said in a Sunday note. “The medium-term risks to our forecast continue to the downside given possibly further tariff escalation and probably longer OPEC+ production increases.”
Some of the world’s most prominent oil merchants, including Vitol Group and Gunvor Group, have become increasingly negative, expecting oversupply. The International Energy Agency said last week that the escalating trade war and the Organization of Petroleum Exporting Countries and its allies’ pledge to increase shipments are reducing demand, forecasting a 600,000 barrel surplus this year — or about 0.6% of daily global consumption. However, Goldman Sachs expects prices to rebound “modestly” in the coming months, as US economic growth stays strong for now, and Washington’s sanctions system shows no indications of relaxing.
Other geopolitical dangers persist, such as the current US order to target Houthi-controlled locations in Yemen, which continue to threaten Red Sea trade. According to Goldman, oil demand would climb by 900,000 barrels daily in January, 18% less than previously estimated. The bank predicts that Brent will trade between $65 and $80 per barrel next year, with an average of $68.
