Goldman Sachs Raises 3-4 Month Brent Oil Average Price to $110, Warns High Oil Prices May Persist Until End of 2027!

Hot Topics

Selected Stocks Data Center Market Center Capital Flows Simulated Trading

Client

Source: Cailian Press

Cailian Press, March 23 — (Editor: Huang Junzhi) As the US-Iran conflict remains deadlocked, Goldman Sachs has raised its oil price forecast for the second time in less than two weeks. The key reasons are the ongoing disruption of the Strait of Hormuz and increasing structural risks in global supply, which are driving the expectation that “high oil prices will last longer.”

The bank currently expects crude oil shipments through the Strait of Hormuz to remain at 5% below normal levels over the next six weeks, with a gradual recovery within a month. However, it is important to note that this ongoing supply disruption, combined with global production concentration and excess capacity, is likely to reshape market dynamics.

The military strikes by the US and Israel on Iran have now lasted over three weeks. To cool the soaring oil prices, the Trump administration is pulling out all the stops. According to the US Department of the Treasury, on March 20 local time, the US approved a 30-day authorization allowing the delivery and sale of ships carrying Iranian crude oil and petroleum products. The new license permits the sale of Iranian crude oil and petroleum products already loaded onto ships as of March 20.

Goldman Sachs’ Head of Oil Market Research, Daan Struyven, recently warned, “The recognition of risks from highly concentrated production and idle capacity may lead to structurally higher strategic reserves and long-term prices.”

He expects that in the short term, due to ongoing uncertainties, prices will continue to rise modestly.

“Prices may continue to climb… until the market is confident that long-term supply disruptions are unlikely,” he said, adding that “increasing risk premiums” are needed to curb demand growth and hedge against potential shortages.

Based on this, Struyven now forecasts that the average Brent crude oil price from March to April will reach $110 per barrel, up from the previous estimate of $98, which would be a significant increase compared to 2025 levels.

However, the impact of this upward revision extends far beyond immediate market volatility.

Goldman Sachs also raised its 2026 Brent crude oil price forecast from $77 to $85 per barrel, and its West Texas Intermediate (WTI) forecast to $79 per barrel. Additionally, long-term oil price expectations have been adjusted upward. The bank stated that these adjustments reflect further declines in commercial oil inventories and the re-pricing of effectively idle capacity as markets adjust to higher risks.

This marks the second time in just two weeks that Goldman Sachs has raised its price forecasts. On March 11, Goldman Sachs increased its Q4 2026 forecasts for Brent and WTI crude oil from $66 and $62 to $71 and $67 per barrel, respectively.

Looking ahead, Goldman Sachs expects the average price of Brent crude oil in 2027 to reach $80 per barrel, but also notes significant upside risks. In extreme scenarios where the Hormuz Strait transportation volume remains severely restricted over the long term, “the daily price of Brent crude could exceed the record highs of 2008.”

“Even in less severe scenarios, oil prices could stay elevated. Under a ‘severely adverse scenario’ of continued shortfalls in Middle Eastern oil supply, Brent prices could surge and then stabilize around $115 per barrel before the end of 2026,” the bank added.