Goldman Sachs Raises 3-4 Month Brent Oil Average Price to $110, Warns High Oil Prices to Persist Through End of 2027

MarketWatch, March 23 (Editor: Huang Junzhi) — As the U.S.-Iran conflict remains deadlocked, Goldman Sachs has raised its oil price forecast for the second time in less than two weeks. The key factors driving this are the ongoing disruption of the Strait of Hormuz and increasing structural risks in global supply, which Goldman believes will keep high oil prices sustained for longer.

The bank currently expects crude oil shipments through the Strait of Hormuz to remain at 5% of normal levels over the next six weeks, then gradually recover within a month. However, this ongoing supply disruption, combined with global production concentration and excess capacity, is expected to reshape market dynamics.

The U.S. and Israel’s military strikes on Iran have lasted over three weeks. In an effort to cool soaring oil prices, the Trump administration is pulling out all the stops. According to the U.S. Department of the Treasury, on March 20 local time, the U.S. approved a 30-day authorization allowing the delivery and sale of ships loaded with Iranian crude oil and petroleum products. The new license permits the sale of Iranian crude oil and petroleum products already loaded onto ships as of March 20.

Goldman Sachs’ head of oil market research, Daan Struyven, warned that “recognition of the risks posed by highly concentrated production and idle capacity could lead to structurally higher strategic reserves and long-term prices.”

He expects that in the short term, prices will continue to rise modestly amid ongoing uncertainty.

“Prices may continue to climb… until the market is confident that long-term supply disruptions are unlikely,” he said, adding that “an increasing risk premium” is needed to curb demand growth and hedge against potential shortages.

Based on this, Struyven now forecasts that the average price of Brent crude oil from March to April will reach $110 per barrel, up from the previous forecast of $98, representing a significant increase compared to 2025 levels.

However, the impact of this upward revision extends far beyond immediate market volatility.

Goldman Sachs also raised its 2026 Brent crude oil price forecast from $77 to $85 per barrel, and its West Texas Intermediate (WTI) forecast to $79 per barrel. The bank noted that these adjustments reflect further declines in commercial oil inventories and the re-pricing of effectively idle capacity as markets adjust to higher risks.

This marks the second upward revision within just two weeks. On March 11, Goldman Sachs raised its forecast for Q4 2026 Brent and WTI prices from $66 and $62 to $71 and $67 per barrel, respectively.

Looking ahead, Goldman Sachs expects the average price of Brent crude in 2027 to reach $80 per barrel, but also highlights significant upside risks. In an extreme scenario where the Hormuz Strait remains severely restricted over the long term, “the daily price of Brent crude could surpass the all-time high of 2008.”

“Even in less severe scenarios, oil prices could stay elevated. Under a ‘severely adverse’ scenario of continued Middle Eastern supply shortages, Brent prices could surge and then stabilize around $115 per barrel before the end of 2026,” the bank added.