Goldman Sachs Forecasts Brent Crude at $80–$90 Range Pending US-Iran Agreement or Significant Escalation
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**Goldman Sachs Projects Brent Crude Between $80 and $90 Pending U.S.-Iran Resolution or Escalation**
Goldman Sachs announced on Tuesday that it projects Brent crude prices to remain within an $80 to $90 per barrel corridor. This range is expected to hold until there is either a finalized nuclear agreement between the United States and Iran or a major escalation in their ongoing conflict.
According to the bank’s analysis, the fair value of spot Brent is positioned around $80 per barrel. This valuation indicates that global markets are currently factoring in only a minimal risk premium, despite persistent anxieties regarding oil supplies from the Middle East.
On Tuesday, Brent crude was priced near $85 per barrel. The market faced volatility due to mixed signals from Washington and Tehran regarding the progress of negotiations aimed at resolving their five-month-long conflict.
While Brent prices dipped into the low-to-mid $80s following the postponement of planned U.S. military strikes on Iran and reports of diplomatic progress regarding transit through the Strait of Hormuz, Goldman Sachs emphasized that physical oil markets are steadily tightening.
The bank reported that global visible oil stockpiles decreased by 6.3 million barrels per day over the last fortnight. This decline was attributed to reduced exports from Russia and the Gulf region, shipping disruptions in the Red Sea, and robust demand from Asian importers.
Furthermore, Goldman Sachs estimated that oil exports from the Gulf have plummeted to roughly 36% of their pre-war volumes on a seven-day moving average, a sharp decline from the 80% levels observed in early July.
Shipping capacity in the Red Sea has also been impacted, with loaded tanker volumes dropping by 22% since the Iran-aligned Houthi movement declared a maritime blockade.
Although Saudi Arabian oil exports have fallen by 2.4 million barrels per day compared to the previous year, the impact of Red Sea shipping bottlenecks has been partially mitigated by redirecting cargo through Egypt’s SUMED pipeline.
Additionally, Goldman Sachs noted a contraction in Russian oil supplies. Combined exports of Russian crude and condensate fell by 1.3 million barrels per day over the past two weeks, exacerbated by ongoing operational disruptions at the Black Sea’s CPC terminal, which have kept export volumes significantly below historical averages.
