Goldman Revises Oil Forecasts Lower as Hormuz Agreement Improves Supply Outlook

Goldman Sachs has trimmed its medium-term oil price forecasts after revising its expectations for the recovery of Persian Gulf exports following the announcement of an interim agreement to reopen the Strait of Hormuz.

The bank now expects regional exports to return to pre-war levels by the end of July, one month earlier than previously forecast, prompting a reassessment of its crude market outlook.

Under its updated projections, Brent crude is expected to average $80 per barrel in the fourth quarter of 2026, down from the previous forecast of $90, while the 2027 average has been lowered to $75 from $80. Goldman also reduced its WTI estimates, forecasting averages of $75 in late 2026 and $70 in 2027.

Analysts said the earlier recovery in supply materially reduces the fair value of oil prices over the forecast period. However, they stressed that significant uncertainty remains around the pace and durability of the recovery.

Goldman described the risks to its assumptions as “two-sided,” noting that stronger Gulf export flows, potential increases in Saudi, UAE and Iranian output, and low global inventories could tighten markets. At the same time, renewed geopolitical tensions, tanker security concerns and the possibility of future disruptions in the Strait of Hormuz could undermine the recovery.

The bank continues to expect oil prices to remain broadly supported despite forecasting a sizeable market surplus in 2027. Limited storage capacity, recent inventory drawdowns and ongoing strategic stockpiling are expected to help keep prices near long-term equilibrium levels.

“Some security premium compensating for disruption risk is likely to keep a floor under prices,” the strategists wrote.

While Goldman’s base case assumes a gradual normalization in exports, it said a prolonged disruption to Hormuz traffic could push Brent above $130 per barrel in late 2026. Conversely, a faster-than-expected recovery in exports combined with weaker demand and stronger production growth could see Brent fall below $60 per barrel during 2027.