Morgan Stanley and Goldman Sachs Slash Brent Price Forecasts

Morgan Stanley has cut its projection for Dated Brent to $75 per barrel for both the third and fourth quarters of this year. This latest revision, the bank’s second in two weeks, marks a $15 drop for the third quarter alone. Analysts point to a combination of surging U.S. oil exports, tepid Chinese demand, and the easing of geopolitical tensions in the Middle East as the primary drivers of this price correction. Looking further ahead, the bank expects prices to settle at $70 per barrel by the end of 2027.

Goldman Sachs has similarly adjusted its outlook, lowering its fourth-quarter forecast from $90 to $80 per barrel. Their analysts anticipate that tanker traffic through the Strait of Hormuz will fully recover by the end of July. However, the firm notes that some regional oil producers have established alternative transport routes during the crisis, which may permanently alter traffic patterns in the strait. Goldman has also reduced its 2027 average Brent forecast to $75 per barrel, down from a previous estimate of $80.