Goldman Sachs Oil Forecast – See Base Case for $90/bbl Brent Cap, Downside Risk

Goldman Sachs on oil, in brief:

• Sees a cap of $90/bbl in their base case of no geopolitical supply shocks, and risks to their $75-90 range as modest on lower oil prices

• We expect healthy consumers and solid summer demand for transportation and cooling to push the oil market into a sizeable deficit in Q3 of 1.3 MB/d.
• “So we expect Brent to rise to $86/bbl in Q3 and still recommend our trade in the OPEC range (Brent Dec24 extension $80/90 call spread)”
• It maintains its 2025 average Brent forecast unchanged at $82/bbl, reflecting that a modest reduction in China-driven demand growth in 2024 to 1¼mb/d roughly offsets a modest 0.1mb/d reduction in non- OPEC from 2024.