Goldman Sachs Group said it expects OPEC+ to repeat recent production increases for a fourth month for August, a change from its earlier forecast that the group would pause after last weekend’s meeting.
“Relatively tight spot oil fundamentals, beats in hard global activity data, and seasonal summer support to oil demand” are all supportive, analysts including Daan Struyven said in a note. “The expected demand slowdown is unlikely to be sharp enough to stop raising production when deciding on August production levels on July 6.”
The Organization of the Petroleum Exporting Countries and its allies agreed on Saturday to increase supply targets by 411,000 barrels a day for July, matching increases scheduled for May and June. The hikes marked a radical reversal from the cartel’s former strategy of defending prices by curbing output.
The decision likely also reflected a move toward normalising spare capacity within OPEC+, supporting internal cohesion and putting pressure on US shale producers, Goldman said.
The Wall Street giant now expects the cartel to hold supply quotas steady from September, forecasting production outside the group will increase and global economic growth will slow in the third quarter.
However, risks are skewed toward further OPEC+ increases after August, the bank said.
See also: Malaysia’s Petronas to cut 10% of workforce on profit slump
Goldman maintained its average oil price forecasts for Brent at US$60 a barrel for the remainder of the year and US$56 in 2026. West Texas Intermediate is seen at a US$4 discount to the global benchmark for the periods.
