Goldman Sachs has cut the outlook for oil prices to below $80 a barrel amid expectations of a surplus next year.
The Wall Street bank expects global benchmark Brent prices to hit $77 in 2025, down from its previous forecast of $82, as producers possibly ratchet up supplies.
This could include Opec+, which comprises the 23 largest oil producers globally, easing voluntary supply cuts which have kept prices afloat.
Slowing demand in China concerns over greater supply from producers outside Opec, and a sense that Opec members might ramp up production have all led to expectations of falling prices in 2025.
Morgan Stanley also predicts prices will fall to between $75 to $78 per barrel next year. Brent crude prices have averaged $83 per barrel year to date.
As expectations rise that OPEC, which supplies over 35% of the world’s oil, may reduce its voluntary production cuts in the coming months, oil prices are projected to fall below $80 per barrel.
The bank also notes that slowing demand from China could contribute to an oversupply, aligning with Morgan Stanley’s forecast for a price decline in 2025.
So far this year, benchmark Brent crude has averaged $83 per barrel, with recent price increases driven by heightened tensions in the Middle East.
On Tuesday, Brent crude pulled back from gains following the weekend’s clashes between Israel and Lebanon’s Hezbollah, dropping 1.5% to just above $80.
