A peace agreement for the Persian Gulf is about to be signed, and Goldman Sachs is promptly taking action.
• Peace agreement between USA and Iran moves the oil sector
• Goldman Sachs lowers oil price forecast
• Global oil market appears more adaptable than expected
Goldman Sachs’ commodities team, led by Daan Struyven, cut its Brent price forecast for the fourth quarter of 2026 from $90 to $80 a barrel, a decline of around 11 percent. For the full year 2027, the oil price forecast fell by around 6 percent to $75, as MarketWatch reports. The message behind it is sober: The new target is close to the current market price of around $80, which suggests that the markets have already largely processed the relaxation in the Gulf. What this means for US consumers is that noticeably cheaper gasoline cannot be expected for the time being.
Trigger: ceasefire in the Gulf nearing completion
The immediate reason for the revision is an agreement announced by the White House to end hostilities in the Persian Gulf, which is due to be signed this week. Goldman now expects exports through the Strait of Hormuz to return to prewar levels by the end of July, a month earlier than previously thought. However, the report acknowledges that this assumption remains subject to significant risks. In recent months, President Trump has repeatedly promised an imminent deal, but negotiations have repeatedly stalled.
Supply side: More flexible than expected
The crisis has already shown how adaptable the global oil market has become. Supplies from the Gulf are already at around 11 million barrels a day, supported by diversions via pipelines and road transport, according to the Goldman report. In addition, producers such as Saudi Arabia and the United Arab Emirates could increase production in the short term to meet demand created by low inventories in Europe, Asia and America. If this increase in supply turns out to be greater than expected, there is a risk of further downward pressure on prices.
Risks in both directions
But Goldman Sachs also names upside scenarios. Shipping companies and insurers could develop a permanently higher risk aversion as a result of the crisis, which limits exports. Clearing the Strait of Hormuz from mines is considered a lengthy process, and a renewed Iranian threat cannot be ruled out if negotiations with Washington falter. In the extreme scenario of ongoing tensions in the Gulf, Goldman sees Brent at $130 by the end of 2026 and an annual average of $105 in 2027. The market has now priced in the opposite scenario, a smooth transition. Struyven’s structural finding should still concern traders: The largest oil production shock in history has revealed how resilient and flexible global oil markets have become, especially given how effortlessly China absorbed the supply disruption. This could make the markets less willing to include permanently high geopolitical risk premiums in the price of oil in the future.
Evelyn Schmal, editorial team at finanzen.net