Goldman Sachs Raises Brent Oil Price Outlook to $60 in Q4 2026 Amid Shifting Market Fundamentals

Global investment banking giant Goldman Sachs has revised its oil price outlook upward, projecting that Brent crude will average $60 per barrel in the fourth quarter of 2026. The new forecast, released in the bank’s latest commodities outlook on Sunday, reflects tightening inventories and evolving global supply-demand dynamics. The adjustment is particularly significant for oil-dependent economies like Nigeria, where fiscal planning is closely tied to global crude benchmarks.

In its updated projections, Goldman raised its fourth-quarter 2026 Brent estimate by $6, while increasing its full-year 2026 average forecast to $64 per barrel, up from $56. U.S. benchmark West Texas Intermediate (WTI) is now expected to average $60 per barrel in 2026, compared to its earlier $52 estimate. For the final quarter of 2026, WTI is projected at $56 per barrel. Despite these upward revisions, the bank maintained its outlook of a 2.3 million barrels per day global oil surplus in 2026, citing balanced downgrades to both supply and demand.

The bank attributed much of the price revision to lower crude inventories across member countries of the Organisation for Economic Co-operation and Development (OECD). However, Goldman retained its base-case assumption that there will be no major supply disruptions tied to Iran. It also expects the OPEC+ alliance to begin gradually increasing output from the second quarter of 2026, noting that OECD inventories have not significantly accumulated.

Meanwhile, oil markets remain sensitive to geopolitical developments. On Monday, prices dipped by about one percent as the United States and Iran prepared for a third round of nuclear negotiations, easing fears of escalating tensions. As of early trading, Brent crude futures hovered around $71 per barrel, while U.S. WTI traded near $65.75. Goldman noted that its $60 Q4 2026 Brent forecast assumes a gradual unwinding of a $6 geopolitical risk premium, alongside a projected $5 decline in crude’s fair value due to rising OECD inventories. The bank cautioned that additional supply from Iran or Russia, if sanctions are eased, could push Brent down by as much as $5 and WTI by $8 in late 2026.

For Nigeria, the revised outlook aligns closely with fiscal projections already approved by the Federal Executive Council in December 2025. The government adopted a benchmark oil price of $64 per barrel for the 2026 budget, alongside a production benchmark of 2.6 million barrels per day, with a more conservative 1.8 million barrels per day used for budget calculations. An exchange rate of N1,512 to the dollar was also set for the fiscal framework. While Goldman’s forecast offers some reassurance, continued volatility — including the unresolved Russia-Ukraine conflict and softer growth in parts of Asia — means oil markets could still face sharp swings in the months ahead.

source: nairametrics