Goldman Sachs has raised its oil price forecasts, projecting Brent crude to average $90 per barrel and West Texas Intermediate at $83 per barrel in Q4 2023. Current trading prices are significantly higher, with Brent at $106.68 and WTI at $95.35. The bank attributes this surge to stalled negotiations between Iran and the U.S. and warns of larger economic risks that could further elevate oil prices due to refined product shortages and a significant supply shock.
Analysts expect global oil demand to decline by 1.7 million barrels per day this quarter and by 100,000 barrels daily in 2026 compared to 2025. Goldman Sachs highlights that extreme inventory draws are not sustainable, suggesting that continued supply disruptions may necessitate even sharper demand reductions. ING analysts echo this sentiment, noting that the lack of progress in peace talks is tightening the market, which will likely lead to further price increases.
Market professionals should prepare for heightened volatility in oil prices as supply constraints persist, potentially leading to demand destruction and impacting broader market dynamics.
Source: oilprice.com