Goldman Sachs assumes oil prices to pick up in Q4 26 as the market starts pri...

** Goldman Sachs assumes oil prices to pick up in Q4 26 as the market starts pricing a return to a deficit in H2 27 and shifts focus to incentivising long-cycle production**

• Goldman Sachs forecasts a gradual recovery in oil prices, with Brent reaching $80/bbl and WTI $76/bbl by late 2028.
• TTF gas prices are expected to decline, with a bearish LNG cycle not fully priced in the forward curve.
• Traders are observing potential opportunities in energy markets, particularly in oil and gas futures.

Goldman Sachs has released a forecast indicating a gradual recovery in oil prices, projecting Brent crude to reach $80 per barrel and WTI crude to hit $76 per barrel by late 2028. This outlook is based on expectations of a market deficit emerging in the second half of 2027, which could drive prices higher. The energy sector, particularly oil, is likely to see increased attention from market participants as they assess the implications of these projections.

In the natural gas market, Goldman Sachs anticipates TTF gas prices to be EUR 29/MWh in 2026 and EUR 20/MWh in 2027. The firm highlights a bearish LNG cycle that has not been fully priced into the forward curve, suggesting potential opportunities for traders. Specifically, they recommend shorting Q3 2027 TTF, indicating that the current market conditions may not fully reflect the expected oversupply in the coming years.

The energy sector, including oil and gas, remains a focal point for traders and market participants. The projected recovery in oil prices could influence related stocks and ETFs, such as ExxonMobil (XOM) and the Energy Select Sector SPDR Fund (XLE). Additionally, the anticipated decline in TTF gas prices may impact European energy markets and related assets.

Market participants are closely monitoring these developments, considering the potential impact on their portfolios. The projected rise in oil prices could lead to increased interest in energy stocks and ETFs, while the bearish outlook for TTF gas may prompt traders to reassess their positions in European gas markets.

Trader Insight:

• Some traders may consider monitoring WTI crude and Brent futures for signs of price recovery.
• Market participants are watching XLE for potential shifts in energy sector sentiment.
• Traders could assess risk in European gas markets, particularly with TTF futures, given the bearish LNG cycle outlook.

Disclaimer: This is not trading advice. For informational purposes only.