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Investing.com -- Goldman Sachs has updated its oil price forecast to include a higher geopolitical risk premium following Israel’s attack on Iran, while maintaining its view that Middle East oil supply will not face disruptions.
The U.S. bank continues to project Brent crude prices will drop to $59 per barrel and West Texas Intermediate (WTI) to $55 per barrel in the fourth quarter of 2024. Looking further ahead, Goldman Sachs forecasts Brent at $56 per barrel and WTI at $52 per barrel in 2026.
Goldman Sachs analysts noted that "the potential of further escalation in the Middle East implies that the short-term risks to our price forecast are now skewed to the upside on net."
The bank’s forecast is based on expectations of robust supply growth outside of U.S. shale production. While acknowledging increased short-term upside risks due to Middle East tensions, Goldman Sachs still sees medium-term downside risks stemming from potential OPEC+ supply increases and ongoing uncertainty in global trade conditions.
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