Goldman’s base case of Brent at $80 by year-end and $75 in 2027 suggests limited further downside from current levels, with the bank arguing the market has largely priced the recovery already. The asymmetry in the risk scenarios is the key trading signal: $50 of upside in the slow-recovery scenario against only $20 of downside if flows normalise faster than expected. Low inventories and a persistent disruption risk premium provide a floor. Demand recovery is expected to be swift but not complete, with EV penetration in China keeping a structural drag of around half a million barrels per day on the demand baseline into 2027.
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Goldman Sachs sees Brent averaging $80 at year-end and $75 in 2027, with risk skewed to the upside as low inventories and Hormuz uncertainty sustain a disruption premium even in the base case.
Summary:Daan Struyven, Co-Head of Global Commodities Research in a podcast, recorded 16 June 2026
- Brent has fallen from above $120 to the low $80s as markets price in a base-case recovery of Middle East supply by end of July
- Strait flows need to recover to roughly 70% of normal for regional exports to fully normalise
- Goldman forecasts Brent at $80 and WTI at $74 by year-end, moving to $75 and $70 respectively in 2027
- Upside scenario: if Hormuz never fully reopens and Gulf exports recover only gradually, Brent could exceed $130 by year-end
- Downside scenario: faster reopening and persistent demand losses could push Brent to $60 in 2027
- China’s 4-5 million barrel per day drop in crude imports is cited as the primary reason oil has not breached triple digits
- Around 90% of the 5 million bpd demand loss is expected to recover by 2027, but EV growth leaves a residual half-million bpd structural drag
Goldman Sachs expects Brent crude to average $80 per barrel by year-end and $75 in 2027, with its commodities research team arguing that markets have largely priced in the base-case recovery of Middle Eastern supply but that risks remain skewed to the upside.
Daan Struyven, co-head of global commodities research at Goldman, said the selloff from above $120 to the low $80s reflected market confidence that flows through the Strait of Hormuz will begin recovering and that regional exports will return to normal levels by the end of July. For that to happen, strait transit volumes need to reach roughly 70% of pre-conflict levels, with pipeline rerouting having absorbed much of the remainder.
Struyven framed the key uncertainty as one of Iranian intent rather than logistics. If Tehran allows flows to increase and early transits proceed without incident, other shippers are likely to follow. But he noted the market has seen false starts before.
The risk distribution is notably asymmetric. A slow-recovery scenario in which the strait never fully reopens puts Brent above $130 by year-end. A faster-than-expected reopening combined with more persistent demand losses could push prices to $60 in 2027. Struyven judged both scenarios as roughly equal in probability but stressed the upside move is far larger in magnitude.
Even in the base case, a structural premium remains. Inventories are depleted, the conflict has permanently altered some demand patterns, and Goldman sees oil prices running roughly $20 per barrel above pre-war levels on a sustained basis.
This article was written by Eamonn Sheridan at investinglive.com.
