Goldman Sachs lowered its oil price forecast for the second quarter of this year, following a two-week ceasefire agreement between the United States and Iran, which helped to ease geopolitical concerns and reduce pressure on markets.
In a note issued Wednesday evening, the bank indicated that it expects Brent crude to average around $90 a barrel during the second quarter, compared to its previous estimate of $99, and lowered its forecast for West Texas Intermediate crude to $87 instead of $91.
The bank explained that this adjustment is due to a decline in the risk premium in futures contracts, coinciding with a gradual improvement in oil flows through the Strait of Hormuz, reflecting the easing of some tensions that had been putting pressure on supplies.
Despite this, Goldman Sachs kept its oil price forecasts for the second half of the year unchanged, expecting Brent crude to average around $82 a barrel in the third quarter and $80 in the fourth quarter.
Meanwhile, West Texas Intermediate crude is expected to reach $77 and $75 respectively during the same two periods.
Despite lowering its short-term outlook, the bank stressed that risks remain and are tilted to the upside, pointing to the possibility of prolonged supply disruptions or a continued decline in crude oil production, which could push prices up again if tensions resurface or energy flows are disrupted globally.
