Wall Street is becoming more pessimistic about the crude oil market for next year. Goldman Sachs and Morgan Stanley have both lowered their price forecasts for Brent crude due to rising global supplies, including potential increases from OPEC+. Goldman Sachs now expects Brent to average $77 per barrel in 2025, while Morgan Stanley predicts a range of $75 to $78. Both banks anticipate a surplus in the crude market, with prices trending lower over the next 12 months.
OPEC+’s possible decision to reverse voluntary supply cuts could indicate a strategy to discipline non-OPEC suppliers, Goldman analysts noted. They also warned that crude prices could fall below their revised forecasts under several scenarios.
Oil prices have declined recently, with Brent last trading at around $81 per barrel, due to concerns over slowing demand in China and increasing non-OPEC+ supplies. Morgan Stanley expects the crude market to reach equilibrium by the fourth quarter of 2024 and move into surplus in 2025.