Insights 
VT 
Goldman Sachs anticipates a decrease in Brent and WTI crude prices. They predict an average of $60 for Brent and $56 for WTI throughout the remaining months of 2025.
In 2026, the forecast for Brent prices is an average of $56, while WTI is expected to average $52. The projection is based on anticipated supply growth beyond US shale production, which may exert downward pressure on oil prices.
Goldman Sachs Projections for 2025 and 2026
The existing content outlines Goldman Sachs’ projections for Brent and WTI crude oil prices moving into 2025 and 2026. According to their forecast, prices are expected to trend downwards, with Brent averaging $60 and WTI around $56 through the rest of next year. For the following year, Brent is estimated to average $56, and WTI $52. These forecasts are grounded in expectations of an uptick in global supply, not just in US shale, but from additional sources as well.
This isn’t a minor shift. From this, it becomes clear that the market is heading towards a phase characterised by stronger supply dynamics—even outside traditional or high-cost production zones. That has direct consequences for the pricing structure of derivative contracts, particularly where long positions have been taken in anticipation of price increases or in an environment with previously tighter supply assumptions.
We’ve been noticing that supply expansions in places such as South America, West Africa, and potentially parts of Central Asia have created more predictable flows. Combined with improvements in logistics and shipping, this introduces a smoother baseline from which to evaluate near-term volatility in contracts. The US shale element is not absent, but the broader supply contribution appears to weigh more heavily in this assessment.
Impact on Oil Linked Futures and Options
In our view, this means that traders holding exposure to oil-linked futures or options may want to model flatter forward curves in the short to medium term. Carry structures—especially for those rolling longer-dated Brent contracts—could see compression. If one has existing exposure to calendar spreads based on steeper backwardation, the current signals suggest that these could narrow further, especially as physical storage concerns ease.
Curran, who contributed to this analysis, relies heavily on upstream field data and shipping bottlenecks, rather than short-term geopolitical shocks. This implies the anticipated price shifts are not temporary, but more structural. An implied volatility surface that had been skewed for upside coverage may flatten, and implied volatility itself may begin to trend downwards, dragging risk premiums along with it.
Short-dated options may lose some of the edge they previously offered if volume adjusts to these more stable supply expectations. For those managing gamma exposure, one thing to consider is whether the intra-month price moves still retain enough amplitude to justify the usual hedging cadence. If underlying futures contracts shift into tighter ranges, active strategies may need to focus more on timing rather than frequency.
Lombardi’s work suggests that capacity additions are not only planned but are already partially funded, with fiscal incentives in place from local governments. All this presents a backdrop where bullish bets based on tightness could be systematically unwound.
We are watching cross-commodity positioning, too. Because this new supply backdrop is not localised to one geography, the behaviour of spreads—Brent/WTI, as well as gasoline versus crude—could start aligning more closely to shipping pathways and refined product margins, rather than simply inventory draws.
In basic terms, the pricing assumptions from field-level data upwards are starting to look more stable than they have for some time. What this does is introduce a level of forward visibility that we haven’t seen since well before the pandemic. And with that, discretionary leverage needs to be recalibrated—at least around the oil side of cross-asset books.
Some may see opportunity in the move towards mean-reverting price action, while others might better benefit from reducing exposure to convexity altogether. Either way, it’s the calm that tends to test the conviction of risk managers most.
