Oil Prices Drop 1% After OPEC+ Output Hike, Goldman Sachs Reiterates $64 Brent Forecast for Q4.

Oil prices declined over 1% after OPEC+ agreed to a significant supply hike in September. Despite this, Goldman Sachs maintains its price forecast with Brent averaging $64 in Q4 2025 and $56 in 2026.

Oil prices experienced a significant drop of over 1% on Monday following OPEC+'s agreement to increase oil production by 547,000 barrels per day in September [1]. Despite the substantial supply hike, Goldman Sachs maintained its forecast for Brent crude oil, expecting the price to average $64 per barrel in the fourth quarter of 2025 and $56 in 2026 [2].

The decision by OPEC+ to increase production was largely in line with market expectations, but it did lead to a temporary dip in oil prices. Brent crude (CO1:COM) fell below $69 a barrel, while WTI crude (CL1:COM) eased to around $66 a barrel [1]. The reversal of one layer of the 2.2 million barrels per day (mbpd) of voluntary crude production cuts took just six months, a much quicker pace than initially planned [1].

Goldman Sachs acknowledged several risks to its baseline estimates. The investment bank cited potential upside risks from pressures on Russia and Iran's oil supply, which could lead to faster-than-expected normalization in spare capacity. Additionally, Goldman Sachs warned of downside risks to demand growth due to weak US economic indicators and potential tariff increases [2].

OPEC+ will continue to hold monthly meetings to review market conditions, conformity, and compensation, with the next meeting scheduled for September 7 [1]. The market will also be closely watching US President Trump's decision on Russia this Friday, as it may impact buyers of Russian oil with potential secondary sanctions or tariffs [1].

Despite the recent developments, Goldman Sachs remains confident in its forecast, attributing the resilience of oil prices to the market's ability to absorb additional supply from OPEC+ [2].

References:
[1] https://seekingalpha.com/news/4477117-oil-slides-over-1-after-opec-output-hike-goldman-sticks-to-64-brent-forecast-for-q4
[2] https://www.fxleaders.com/news/2025/08/04/brent-oil-outlook-unchanged-by-goldman-sachs-demand-concerns-loom/