New York City: New York: Goldman Sachs has signaled a prolonged downturn in oil prices, forecasting a steady decline through the end of 2026 due to weak global demand and rising output from oil-producing nations.
The Wall Street bank said it expects Brent crude to average U$63 a barrel for the rest of 2025, falling to $58 in 2026. West Texas Intermediate (WTI) is projected to drop to $59 this year and further to $55 next year.
In a research note issued over the weekend, Goldman cited the escalating U.S.-China trade war and the growing risk of recession as key drivers behind its forecast. The firm slashed its global oil demand growth projections for the fourth quarter of 2026 by 900,000 barrels per day (bpd) since mid-March, citing deteriorating macroeconomic conditions.
"Given the weak growth outlook amid a global trade war," Goldman said, "we now expect oil demand to rise by only 300,000 bpd between the end of last year and the end of 2025."
Last week, Beijing raised tariffs on U.S. goods to 125% in response to President Donald Trump's decision to sharply increase duties on Chinese imports—deepening a standoff that has already roiled global markets.
Despite the oil market already pricing in some future inventory builds, Goldman sees large surpluses of 800,000 bpd in 2025 and 1.4 million bpd in 2026 continuing to weigh on prices.
The bank also outlined a more severe downside scenario in which either a global slowdown deepens or the 2.2 million bpd in voluntary output cuts by OPEC+ are fully reversed. In such cases, Brent could fall into the $40 range by 2026—and potentially drop below $40 in an extreme scenario.
As of early this week in Asia, Brent crude futures had slipped to around $64.72 a barrel, while WTI was trading at $61.44.
Goldman also lowered its U.S. shale supply estimate for Q4 2026 by 500,000 bpd, further underscoring expectations of a market flush with supply but lacking the demand to support current price levels.
