Due to the "Hormuz shock," Goldman Sachs raised its Q4 Brent oil forecast to $90.

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The blockade of the Strait of Hormuz is draining global oil inventories at a rate exceeding 10 million barrels per day.

According to Wind Chasing Trading Desk, on April 26th, Goldman Sachs’ Commodity Research team released the latest oil market report, sharply raising its Q4 2026 Brent crude price forecast from $80 to $90 per barrel, and WTI from $75 to $83 per barrel. The 2027 forecast for Brent/WTI was also raised from $80/$75 to $85/$80.

The report notes that although oil prices rebounded this week due to persistently low flows through Hormuz, prices remain below the late March peak — market expectations for reopening the Strait have suppressed risk premiums and triggered destocking. Goldman believes the gap between this optimistic expectation and the reality of supply is the biggest current market risk.

Where does the nearly $30 jump in price come from?

Goldman broke down the rationale for this forecast revision: Compared to before the Hormuz shock, Q4 Brent forecast has increased by nearly $30 per barrel.

About $18 comes from massive drawdown in commercial inventories. The report estimates that, considering policy responses (including releasing sanctioned oil, using and replenishing strategic reserves), declining demand, and increased production from the US and Russia, the Hormuz shock will lead to a net reduction of 12.36 billion barrels in global commercial oil inventories (by Q4 2026). The lower the inventory, the greater the premium of spot over forward contracts (i.e., the term structure spread), directly pushing spot prices higher.

Another $9 comes from higher long-term prices. Goldman assumes Persian Gulf capacity will suffer a permanent loss of 500,000 barrels/day (mainly in Iraq), and the market will re-evaluate the risk of spare capacity — usually concentrated in the Gulf — giving it a higher "security premium". The report notes that spare capacity was about 3.7 million barrels/day before the shock; for every 1 million barrels/day reduction in effective spare capacity, long-term prices rise about $4.

Inventory drawdown speed: Record breaking

The numbers themselves are stunning.

Goldman estimates that in April, Persian Gulf crude output loss reached 14.5 million barrels per day — with pre-war forecast at 26.4 million barrels/day, current actual output is just about 11.9 million barrels/day.

This supply gap is consuming global oil inventories at a rate of 11–12 million barrels per day, the fastest inventory drawdown ever recorded. The report cross-checked the figure via three methods:

Inventory method: Global visible inventories fell 5.8 million barrels/day in April; plus estimated "hidden" inventories (mainly non-OECD refined products) fell 6.2 million barrels/day, totaling roughly 12 million barrels/day;
Supply-demand method (Hormuz flows): Tracking Gulf exports via Hormuz and pipelines, estimated April supply-demand gap at 11.3 million barrels/day;
Supply-demand method (country balance): Global production at 9.02 million barrels/day vs demand at 10.16 million barrels/day, gap again at 11.3 million barrels/day.

As of April 24, since the Hormuz shock began, cumulative global oil deficit has reached 5–7 billion barrels.

Under the baseline scenario, the market will swing from a supply surplus of 1.8 million barrels/day in 2025 to a historic deficit of 9.6 million barrels/day in Q2 2026, with OECD commercial inventories dropping 2.2 million barrels/day in a single quarter.

Goldman expects Persian Gulf crude output recovery will be gradual: by percentage of lost output, about 70% restored by July, 90% by December; cumulative output loss will reach 18.3 billion barrels. Saudi Arabia and UAE will raise output above pre-war levels in the second half of 2026 to help stabilize the market.

Demand side: High oil prices are suppressing consumption

The other side of the supply shock is an active contraction in demand.

Goldman expects, due to surging refined product prices, global oil demand in Q2 2026 will drop 1.7 million barrels/day year-on-year, and the full year will see a decline of 100,000 barrels/day year-on-year. The report points out that the spread between refined product and crude prices is currently at a historic high.

Regions with relatively larger demand downgrades include: Middle East (directly affected by supply shock), South Korea and Japan (petrochemical centers with tight feedstock supplies), as well as price-sensitive areas such as Africa.

The report also warns: "Extreme inventory drawdowns are unsustainable. If the supply shock lasts longer, greater demand loss may be needed." In other words, if the Strait doesn’t reopen promptly, prices will be forced higher until demand is “destroyed” enough to balance the market.

Supply response outside the Middle East: A drop in the bucket

Facing a daily shortfall exceeding 10 million barrels, supply response outside the Middle East is quite limited.

Goldman expects global supply outside the Gulf will rise by only 1 million barrels/day in 2026 compared to pre-shock levels, mainly from:

Russia: +400,000 barrels/day; production stays at 10.5 million barrels/day (previously forecast to fall), benefiting from high prices and better profit, but still faces downside risk from drone attacks;
USA: +300,000 barrels/day; limited increase due to expectations that Hormuz shock is short-lived, low drilled but uncompleted (DUC) well count, negative Waha natural gas prices tied to oil production, and shale capital discipline constraints;
Kazakhstan: +200,000 barrels/day.

Report notes, once the Strait reopens, the largest supply response will come from Saudi and UAE ramping up output in H2 2026. In the base scenario, global supply drops 12.1 million barrels/day year-on-year in Q2 2026, with modest growth resuming in Q4.

Three scenarios: Upside risk far exceeds downside

Goldman clearly states risk to current price forecasts is “skewed to the upside”, and gives three scenarios:

Optimistic scenario (Q4 Brent average slightly below $80): Gulf exports return to normal from early May to mid-June, no permanent capacity loss; stronger supply response from the US and core OPEC.

Adverse scenario (Q4 Brent average slightly above $100): Gulf exports return to normal between mid-June and end-July; permanent capacity loss stays at 500,000 barrels/day (same as baseline).

Extreme adverse scenario (Q4 Brent average near $120): Gulf exports also recover mid-June to end-July, but permanent capacity loss rises to 2.5 million barrels/day. Report explains, this loss equals Hormuz flows never recovering to above 70% before expanded pipeline capacity comes online.

Notably, Goldman also points out that in adverse and extreme adverse scenarios, actual prices may be even higher than the model estimates — because when inventories drop to extremely low levels, prices typically jump non-linearly. The report says even in the optimistic scenario, global visible oil inventory will fall to its lowest since 2018 (when satellite tracking began).

US policy risk: Possibility of export restrictions

The report also discusses a tail risk: US oil export restrictions.

This is not Goldman’s base case, but the report clearly says it "does not rule out" the possibility.

In 2025, the US will be a net importer of 2.2 million barrels/day of crude, while it will be a net exporter of refined products, including gasoline (net exports of 700,000 barrels/day) and diesel (net exports of 1.1 million barrels/day).

If the US restricts crude exports, WTI prices will lag behind global benchmarks, US crude inventories will rise, ultimately suppressing shale oil output. If refined product exports are limited, refinery profits will suffer, while the effect on US domestic retail oil prices will be more complex — depending on specific product, region, and scope of restrictions. The report notes that a comprehensive US export restriction could ultimately raise US gasoline prices, as refineries facing diesel inventory accumulation would cut back on overall refined output (including gasoline), exceeding the supply boost from keeping 800,000 barrels/day of gasoline domestic.

Report also notes Thailand, South Korea, and several other countries have already imposed refined product export restrictions.

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