- Goldman Sachs (GS) and Morgan Stanley (MS) slash Brent crude forecasts after interim U.S.-Iran deal.
- Faster-than-expected normalization of Gulf exports expected via reopened Strait of Hormuz.
- Brent seen averaging $80 in Q4 2026 and $75 in 2027, according to Goldman.
Major Wall Street banks are lowering oil-price forecasts as optimism grows over an interim U.S.-Iran agreement that reopened the Strait of Hormuz. Goldman Sachs cut its Brent forecast to $80 for the fourth quarter of 2026 and $75 for 2027, citing expectations of faster Gulf export normalization. Morgan Stanley echoed the shift, projecting Brent averaging $90 in the third quarter of 2026 before easing to $80 into 2026 and early 2027, as supply chains gradually recover.
The interim deal has reduced geopolitical risk premia in oil markets, with expectations that Gulf crude flows will ramp up more quickly than previously anticipated. “The reopening of Hormuz is a game-changer for near-term supply,” a Goldman analyst noted, though full restoration of tanker traffic and production may take months due to logistical hurdles like sea mine clearance and insurer confidence.
Both banks emphasize that the pace of recovery will depend on how swiftly production and export capacity return to pre-crisis levels. While the outlook suggests upside price risk has diminished, broader U.S.-Iran tensions and OPEC+ policy remain wild cards. Other financial institutions have issued similar revisions in response to the same developments, underscoring the sensitivity of prices to flow expectations.
Attempts to reach Goldman Sachs and Morgan Stanley for additional comment were not immediately successful.
Correction: A previous version of this article misstated Morgan Stanley's Q3 2026 forecast. It is $90, not $85.