Goldman Sachs has significantly lowered its crude oil price forecasts following a preliminary agreement between the United States and Iran to reopen the Strait of Hormuz. According to research released by the investment bank in late June 2026, analysts revised their fourth-quarter Brent crude oil price forecast downward to $80 per barrel from $90, and reduced their 2027 average estimate to $75 from $80. The revision reflects Goldman's updated assumption that Gulf exports will normalize to pre-war levels by the end of July, compared to their previous expectation of end-of-August normalization.
The bank also expects WTI to average $75 in the fourth quarter of 2026 and $70 in 2027. Oil prices responded immediately to news of the memorandum of understanding, with crude slipping nearly 5 percent to reach its lowest level since March 10. As of early trading on the day following the announcement, Brent crude futures were down 0.3 percent to $82.94 per barrel, while US West Texas Intermediate eased 0.1 percent to $80.66 per barrel.
The significance of the Strait of Hormuz to global energy markets cannot be overstated. Approximately one-fifth of the world's oil and liquefied natural gas passes through this critical chokepoint. Its closure during the US-Israeli conflict with Iran resulted in approximately 14 million barrels per day of output being shut in, creating considerable supply constraints that supported higher crude prices.
Goldman Sachs analysts noted that normalizing oil exports from Gulf producers to pre-war levels could potentially require a 12 million-barrel-per-day increase in flows through Hormuz from current levels. The bank also anticipates a firmer demand recovery during the second half of 2026 and into 2027, driven by improved oil affordability at lower price levels. However, the investment bank cautioned that risks to the Middle East oil supply outlook remain two-sided.
On the upside, Saudi Arabia and the United Arab Emirates may boost output more aggressively in response to low OECD commercial stocks, while Iran could exceed pre-war production levels if international sanctions are eased. Conversely, potential resumption of regional hostilities, strikes on shipping vessels, or lengthy delays in clearing mines from the Strait could keep exports and production at depressed levels for an extended period. Source: EnergyNow, reporting by Noel John and Swati Verma; published June 16, 2026.
Source: energynow.com