Investment banking giant Goldman Sachs has revised its oil price outlook upward, projecting that Brent crude will average $60 per barrel in the fourth quarter of 2026, despite continued surplus risks and geopolitical uncertainties in the global energy market.
The updated forecast was contained in the bank’s latest commodities outlook released on Sunday, offering fresh signals for oil-dependent economies such as Nigeria.
Goldman raised its fourth-quarter 2026 estimates by $6, citing tighter crude inventories and shifting market fundamentals.
Under the new outlook:
- Brent crude is expected to average $64 per barrel for full-year 2026, up from a previous $56 forecast.
- U.S. West Texas Intermediate (WTI) is projected to average $60 per barrel, compared to an earlier estimate of $52.
- For the final quarter of 2026, Brent is forecast at $60, while WTI is expected to trade at $56.
Despite the upward revisions, the bank maintained its projection of a 2.3 million barrels per day global oil surplus in 2026, reflecting offsetting downgrades of 0.2 million barrels per day to both supply and demand.
Goldman attributed the price adjustment largely to lower crude inventories among members of the Organisation for Economic Co-operation and Development, while retaining its base-case assumption of no major supply disruptions linked to Iran.
Oil prices dipped about one per cent on Monday as the United States and Iran prepared for a third round of nuclear negotiations, easing immediate geopolitical tensions. Brent crude traded around $71 per barrel, while WTI hovered near $65.75.
Goldman noted that its $60 Brent forecast for late 2026 assumes a gradual unwinding of a $6 geopolitical risk premium if tensions ease. The bank also factored in a $5 decline in crude’s fair value tied to rising OECD inventories.
It expects OPEC+ to begin gradually increasing output in the second quarter of 2026, adding that inventories have not accumulated significantly so far. However, it warned that Brent could fall by as much as $5 and WTI by $8 in the fourth quarter of 2026 if sanctions relief for Iran or Russia unlocks additional supply.
The revised forecast broadly aligns with Nigeria’s fiscal assumptions for 2026. In December 2025, the Federal Executive Council adopted a benchmark oil price of $64 per barrel for the national budget.
The government also approved a production benchmark of 2.6 million barrels per day, although a more conservative 1.8 million barrels per day will be used for budget calculations. An exchange rate of N1,512 to the dollar was adopted for the fiscal framework.
While Goldman’s revised outlook offers some reassurance, the bank cautioned that volatility remains likely, particularly given ongoing geopolitical tensions and softer economic growth projections in parts of Asia.
Source: Nairametrics