Goldman Sachs raised its 2025 oil price forecast: supply concerns replaced the risk of recession, and Brent crude was bullish to $66

The Zhitong Finance App learned that on Monday, Goldman Sachs raised its crude oil price forecast for the second half of this year. The current market focus has shifted from concerns about the economic downturn to concerns about possible supply disruptions, declining oil stocks in OECD countries, a sharp drop in idle capacity expectations, and concerns about restrictions on Russian production. The bank raised its Brent crude oil price forecast for the second half of 2025 by $5 per barrel to $66 per barrel; at the same time, it raised the WTI crude oil price forecast by $6 to $63 per barrel.

However, its forecast for 2026 Brent crude oil and WTI crude oil prices remained unchanged at $56 per barrel and $52 per barrel, respectively. This reflects long-term price increases providing some support, offsetting the impact of a larger oversupply of 1.7 million b/d compared to the previous 2026 oversupply forecast of 1.5 million b/d.

Goldman Sachs also expects OPEC+ to eliminate 2.2 million b/d production cuts by September, including an eventual increase of 550,000 barrels per day.

The bank added: “The reduction in idle capacity makes us more confident that prices will rebound after 2026.” Its more optimistic long-term forecast is based on many factors, including declining investment, no new non-OPEC projects after 2026, and increased demand over the next decade.

Crude oil futures fell on Monday. Because President Trump's latest plan to force Russia and Ukraine to reach a cease-fire agreement did not include any measures directly aimed at damaging Russian energy exports.

Trump said that the US will supply Ukraine with “top weapons” and threatened that if the two sides fail to reach a cease-fire agreement within 50 days, then 100% “secondary” tariffs will be imposed on countries that trade with Russia. However, he did not announce direct sanctions against Russian oil transportation, and some traders previously speculated that Trump might mention such sanctions when he promised to issue an “important statement” on the Russian issue last week.

Price Futures Group analyst Phil Flynn pointed out that the oil market's reaction to this was lackluster because the 50-day period ensures that there is no possibility of any interruption in oil supply. Moreover, “fears of immediate sanctions against Rosneft are far less likely to occur in the future than the market previously thought.”

Additionally, over the weekend, Trump threatened to impose a 30% tariff on goods from the European Union and Mexico, which could adversely affect the outlook for energy demand.

International oil prices fell on Monday. The Brent crude contract fell $1.15, or 1.63%, to close at $69.21 a barrel. The US West Texas Intermediate Crude Oil (WTI) contract fell $1.47, or 2.15%, to close at $66.98 a barrel. However, the New York Mercantile Exchange's main gas futures for August delivery closed up 4.6% at $3.466 per million British thermal units, as the US weather forecast showed that the weather would be hotter and the flow to liquefied natural gas export terminals continued to increase.