Goldman Sachs: Oil Faces Two-Way Risks as Weak Demand Competes with Middle East Supply Losses

Golden Ten Data reported on June 1 that Goldman Sachs believes oil prices are facing two-way risks as weak demand competes with supply losses in the Middle East caused by the Iran war. In a report on May 31, analysts including Daan Struyven stated that April oil sales data from Western Europe suggest there is a downside risk of about 2 million barrels per day to the bank's already "very low" demand forecast for April. This adds approximately $10 per barrel of downside risk to its Brent crude price forecast of $90 per barrel for the fourth quarter. Goldman Sachs analysts said, "We believe Middle East supply losses could persist for longer, which constitutes a significant upside price risk, but weak demand also poses significant downside price risk. Actual end-user oil demand could fall even more than expected due to rising prices."