Goldman Sachs Raises Q4 Brent Oil Expectations to $90

The blockage of the Strait of Hormuz is depleting global oil inventories at a rate exceeding 10 million barrels per day.

According to news from the Zhuifeng Trading Desk, on April 26, Goldman Sachs' commodity research team released the latest oil market report, significantly raising the forecast for Brent crude oil prices in Q4 2026 from $80 to $90 per barrel, and from $75 to $83 per barrel for WTI, while also raising the forecasts for 2027 Brent/WTI from $80/$75 to $85/$80.

The report indicates that despite a slight recovery in oil prices this week due to the continued low flow through Hormuz, prices are still below the peak at the end of March—market expectations for the reopening of the strait have reduced the risk premium and triggered destocking behavior. Goldman Sachs believes that the gap between this optimistic expectation and the actual supply situation is the biggest market risk at present.

Where does the nearly $30 price jump come from?

Goldman Sachs breaks down the logic behind this forecast increase: The Q4 Brent forecast has risen by nearly $30 per barrel compared to before the Hormuz shock.

About $18 of this comes from a significant drawdown in commercial inventories. The report estimates that, after considering policy responses (including the release of sanctioned oil, the use and replenishment of strategic reserves), decreased demand, and increased production from the U.S. and Russia, the Hormuz shock will result in a net reduction of 123.6 billion barrels in global commercial oil inventories (as of Q4 2026). The lower the inventory, the higher the premium of spot contracts over futures contracts (i.e., the term structure price difference), which directly raises spot prices.

The other approximately $9 comes from an increase in long-term prices. Goldman Sachs assumes that the production capacity in the Persian Gulf will suffer a permanent damage of 500,000 barrels per day (mainly in Iraq), and the market will reassess the spare capacity usually concentrated in the Gulf region, assigning a higher "safety premium". The report points out that before the shock, the spare capacity was about 3.7 million barrels per day; for every reduction of 1 million barrels per day in effective spare capacity, long-term prices rise by about $4.

Inventory consumption rate: Setting historical records

The numbers themselves are shocking enough.

Goldman Sachs estimates that the loss of crude oil production in the Persian Gulf in April reached 14.5 million barrels per day—based on a pre-war forecast of 26.4 million barrels per day, the current actual production is only about 11.9 million barrels per day.

This supply gap is consuming global oil inventories at a rate of 11-12 million barrels per day, the fastest rate of inventory decline on record. The report cross-verifies this figure through three methods:

• Inventory Method: Global visible inventories in April fell by 5.8 million barrels per day, plus an estimated "invisible" inventory decline (mainly non-OECD refined products) of 6.2 million barrels per day, totaling about 12 million barrels per day;

• Supply and Demand Method (Hormuz Flow): Tracking Gulf export demand through Hormuz and pipeline flows, the estimated April supply and demand gap is 11.3 million barrels per day;

• Supply and Demand Method (Country Balance): Global production of 9.02 million barrels per day compared to demand of 10.16 million barrels per day, with a gap of also 11.3 million barrels per day.

As of April 24, since the start of the Hormuz shock, the cumulative global oil shortfall has reached 50-70 billion barrels.

In the base scenario, the market will abruptly shift from a supply surplus of 1.8 million barrels per day in 2025 to a historic supply shortage of 9.6 million barrels per day