Goldman’s estimate implies Brent is trading well above where supply and demand alone would put it, which leaves prices vulnerable to a sharp drop if the risk of escalation fades, and exposed to further spikes if the conflict widens.
The forecast path points lower over time, with the bank expecting a shift into surplus from the fourth quarter to pull prices back toward $80 in 2027, a level consistent with UBS’s view that Brent will approach $80 next summer
Near-term support is likely to come from depleted inventories, including a US Strategic Petroleum Reserve at its lowest since 1982, and from investors using oil as a hedge for their stock and bond holdings. For inflation-sensitive markets, a fading premium would ease pressure on central banks and bond yields, while a renewed spike would reinforce the hawkish case. — Earlier: US strategic oil reserve falls to lowest since 1982 as Iran war release drains stocks — Goldman Sachs reckons about $25 of every barrel of Brent is a bet on the Iran war getting worse, and if that bet does not pay off, the bank sees prices drifting back toward $80. Summary: Goldman Sachs estimates spot Brent carries a risk premium of nearly $25 a barrel above its fair value, reflecting the risk of supply curtailment and inventory draws if the Iran war escalates.
The bank raised its December 2026 Brent forecast to $90 a barrel from $85 and expects an average of $80 in 2027. Persian Gulf exports have recovered to roughly their 2025 average since late September, including an estimated 4 million barrels a day of untracked shipments. The global market was nearly balanced in September, with a deficit of 0.3 million barrels a day against 7.2 million in March, and Goldman expects a surplus from the fourth quarter.