Goldman Sachs raises the March-April Brent crude oil average price to $110, warning that high oil prices will persist until the end of 2027

Ask AI · How will sustained high oil prices until 2027 reshape the global energy market landscape?

Cailian Press, March 23 (Editor: Huang Junzhi) As the US-Iran conflict remains deadlocked, Goldman Sachs has raised its oil price forecast for the second time in less than two weeks, citing ongoing disruptions in the Strait of Hormuz and increasing global supply structural risks as key factors driving the expectation that “high oil prices will last 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, it is important to note that this ongoing supply disruption, combined with global production concentration and excess capacity, is expected to reshape the market landscape.

The military strikes by the US and Israel against Iran have lasted over three weeks. 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, recently warned that, “People are recognizing the risks posed by highly concentrated production and idle capacity, which could lead to structurally higher strategic reserves and long-term prices.”

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

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

Based on this, Struyven now forecasts Brent crude to average $110 per barrel from March to April, up from the previous estimate 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 price forecast from $77 to $85 per barrel, and WTI forecast to $79 per barrel, with long-term oil price expectations also adjusted upward. The bank stated 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 Q4 2026 forecast for Brent and WTI crude 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 notes significant upside risks. In extreme scenarios where the Hormuz transportation volume remains severely restricted over the long term, “the daily price of Brent crude could exceed the all-time high levels seen in 2008.”

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

(Cailian Press, Huang Junzhi)