Goldman Sachs raises 2027 Brent forecast to $88 and sets out $140 scenario

In a November 1 research note, Goldman Sachs raised its average 2027 Brent forecast to $88 a barrel from $80, the investment bank said. In the note, Goldman Sachs also projected Brent crude could jump to $140 a barrel in 2027 if average Gulf oil production came in 3.5 million barrels per day below its average 2025 production levels. The Goldman Sachs 2027 Brent forecast revision includes a base case and supply-disruption scenario.

Goldman Sachs lifts December Brent and West Texas Intermediate forecasts

Goldman Sachs's November 1 note put its December Brent forecast at $105 a barrel, compared with $90 previously. The note also raised the December forecast for West Texas Intermediate crude, or WTI, to $94 a barrel from $81.

For 2027, the bank upgraded its average forecast for WTI to $78 per barrel ($73 per barrel previously). For the separate supply scenario outlined in the note, Goldman Sachs forecast an average 2027 price for Brent of approximately $130 per barrel.

Market data showed that Brent rallied 14% in October and reached a six-month high. The move occurred even as Middle East crude supplies rebounded close to pre-war levels.

A 1-million-barrel-per-day disruption allowance underpins the base case

Goldman Sachs said in its November 1 note that its 2027 base case included an allowance for a global supply disruption of 1 million barrels per day. The bank said intensified attacks on shipping and damage to oil infrastructure could drive prices higher.

Goldman Sachs also linked part of the supply concern to risks from Russia's invasion of Ukraine. The bank's separate scenario assumed average Gulf oil production would remain 3.5 million barrels per day below its 2025 average.

Goldman Sachs cites Middle East and Russia-Ukraine supply risks

Goldman Sachs said oil markets were assigning a higher geopolitical risk premium because of possible disruptions to Middle East supplies. The bank cited the duration of earlier major supply shocks and concerns that a lasting diplomatic breakthrough would be difficult to achieve.

Goldman Sachs said the timing and location of possible disruptions were difficult to predict. It identified conflicts in the Middle East and between Russia and Ukraine, along with increasing geopolitical fragmentation, as risks to global energy supplies.