Goldman projects Brent crude in $50s next year

August 27, 2025 (MLN): Goldman Sachs commodity analysts expect Brent crude to slump to the low $50s next year, citing an expected over supply of some 1.8 million barrels daily towards the end of the year.

The surplus will swell as soon as this year, the analysts also said in a client note cited by Reuters.

The prediction aligns with the International Energy Agency’s latest projection for the oil market, which sees supply growth of as much as 2.1m barrels daily this year.

In contrast, demand is expected to grow by only 700,000 barrels daily, resulting in a surplus of 1.4m barrels daily.

In another signal of bearish sentiment, hedge funds and other speculators cut their bullish bets on Brent and WTI to the lowest in 16 years, according to Bloomberg.

The move was driven by receding fears of additional U.S. sanctions on Russian oil, even as the prospects of a peace deal dimmed after Ukraine’s president stated he would not be making any territorial concessions.

Despite these pressures, Brent crude and West Texas Intermediate have been trending upwards this week.

Brent was changing hands for $67.32 per barrel at the time of writing, while WTI stood at $63.32 per barrel.

Adding to the uncertainty, disruption looms over the oil market as U.S. tariffs on India are set to take effect today.

If the tariffs affect Indian purchases of Russian oil, the impact could prove bullish for global prices, regardless of surplus forecasts.

Energy Intelligence also projects a supply overhang, estimating a surplus of 800,000 barrels daily for this year.

Meanwhile, oil demand in China, the world’s largest importer is showing signs of recovery.

Imports have increased both sequentially and on an annual basis, though overall demand remains down on a yearly comparison.

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