Goldman Sachs increased its outlook for both Brent and West Texas Intermediate (WTI) crude by $5 per barrel. The bank now projects Brent at $85 and WTI at $80 for December 2026, and $80 and $75 respectively for 2027.
Spot Brent futures were trading around $97, having briefly touched $99.53 amid heightened U.S.–Iran tensions. Options‑implied odds of Brent breaking $100 in March 2027 rose to roughly 25%, up from about 6% a month earlier.
Goldman noted that OECD commercial oil inventories have barely drawn since the war began, with global landed stocks falling from 9.1 billion barrels pre‑conflict to 8.6 billion barrels. Chinese crude imports, which are price‑sensitive, remain about 30% lower year‑over‑year.
In an upside scenario, Brent could climb above $120 per barrel if average Gulf output in 2027 stays 4 million barrels per day below pre‑war levels—a sharper shortfall than the base‑case 0.5 million‑bpd gap. The trigger would be intensified shipping attacks in the Strait of Hormuz and the Red Sea. Conversely, a downside case sees Brent slipping into the $60s if Gulf output exceeds pre‑war levels by 1 million barrels per day.
Goldman recommends hedging geopolitical risk via deferred European diesel timespreads from March to December 2027, which could more than double if persistent Russian or Middle‑East refinery outages keep the nine‑month spread near current levels.
