Goldman Sachs has forecast a decline in the price of Brent crude futures contracts to the low $50s a barrel by late 2026, citing an anticipated increase in the oil surplus next year. The US investment bank expects the oil surplus to widen, averaging 1.8 million barrels per day from the fourth quarter of 2025 through the fourth quarter of 2026. This surplus is projected to result in a nearly 800 million barrel rise in global stocks by the end of 2026.
According to Goldman Sachs, stored oil in member countries of the Organisation for Economic Co-operation and Development (OECD) will account for approximately a third of total global stock, or 270 million barrels, in 2026. Reduced demand in OECD countries will also contribute to a decrease in Brent’s fair value from the current mid-$70s. The bank notes that Brent prices are likely to remain near those of forward contracts for the remainder of 2025 but will fall below those contracts next year as the increase in OECD stock accelerates.
However, a potential acceleration in the growth of Chinese stock could raise the 2026 Brent average by $6 a barrel, to $62, versus the bank’s baseline. This forecast comes as Brent crude futures contracts were trading around $67 a barrel in early Asian trade on Wednesday, while West Texas Intermediate crude futures contracts were trading at $63.
The projected decline in oil prices is significant, as it could impact the global energy market and have implications for oil-producing countries. The anticipated increase in oil surplus is attributed to various factors, including changes in global demand and supply. As the energy market continues to evolve, investors and industry stakeholders will be closely watching the price of Brent crude and its potential impact on the global economy.
In recent years, the global energy market has experienced significant fluctuations in oil prices, driven by factors such as geopolitical events, changes in demand, and shifts in global production. The forecast by Goldman Sachs highlights the ongoing uncertainty and volatility in the energy market, underscoring the need for investors and industry stakeholders to remain informed and adapt to changing market conditions. As the situation continues to unfold, it is likely that the price of Brent crude will remain a key focus of attention for market watchers and industry experts.