Goldman Sachs Sees Brent Crude Trapped at $80-$90 Amid Ongoing Iran Conflict

Goldman Sachs has forecasted that Brent crude will trade in the range of $80-$90 per barrel until there is greater clarity on the Iran conflict. The investment bank's estimate is based on the current fair value of spot Brent crude, which they put at around $80 per barrel. Despite persistent uncertainty over Middle East oil supplies, oil markets are pricing in only a modest geopolitical risk premium.

The bank pointed to mixed signals from the United States and Iran regarding negotiations to end their five-month-old conflict as clouding the market outlook. Although Brent prices eased into the low-to-mid $80 range after the United States delayed planned strikes on Iran, physical oil market conditions have continued to tighten.

Goldman Sachs estimated that global visible oil inventories declined by 6.3 million barrels per day over the past two weeks due to lower oil flows from the Gulf and Red Sea, reduced Russian exports, and stronger crude imports across Asia. The bank also noted that Gulf oil exports have fallen to around 36% of their pre-war levels on a seven-day moving average basis.