Brent crude oil prices have dropped from over $80 per barrel in mid-January to around $70 per barrel, despite stable global inventories. According to Goldman Sachs, this decline is linked to a shift in market sentiment rather than supply changes.
Concerns about potential disruptions to Russian and Iranian oil exports have eased, prompting traders to focus on weaker US economic growth. This reassessment may impact global oil demand expectations.
Impact Of Us Economic Growth
Goldman Sachs indicates that slower US GDP growth could reduce fuel demand, affecting oil prices. While supply risks persist, macroeconomic challenges are currently overshadowing positive inventory fundamentals.
Looking ahead, oil prices will depend on US economic indicators and potential disruptions in oil-producing regions. Goldman Sachs has revised its December 2025 Brent crude price forecast to USD 71 per barrel and expects WTI to reach USD 67 per barrel, while global oil demand growth for 2025 is now estimated at 900,000 bpd, down from 1.1 million bpd.
Brent crude has fallen sharply from January highs, now hovering closer to $70 per barrel. Yet, global inventories show no dramatic shifts. If storage levels remain steady, price movements must be driven by shifting expectations rather than physical shortages or surpluses. Goldman Sachs attributes much of this decline to sentiment rather than fundamentals, highlighting how traders have reassessed risks tied to major oil-producing nations.
Fears of major disruptions from Russia and Iran have faded. Markets had previously braced for instability in these regions, but recent developments have eased those worries. With that uncertainty diminished, attention has turned to US economic performance. Weakening growth in the world’s largest economy has taken precedence, shifting focus towards demand-side concerns rather than supply constraints. Goldman Sachs suggests that a slowing US economy is now a key factor pulling crude lower.
If GDP expansion in the US loses steam, fuel consumption patterns are likely to soften as well. Decreased industrial output, lower driving activity, and cautious consumer behaviour could all contribute to a dip in oil demand. That shift outweighs the supply risks that have dominated discussions in previous months. Even as geopolitical tensions persist, the broader economic backdrop is casting a longer shadow over oil markets.
Future Oil Price Outlook
Future price action will depend heavily on whether US economic data confirms these concerns or shows resilience. Any indications of slowing growth may reinforce the current market stance, keeping oil under pressure. On the other hand, signs of economic stabilisation could prompt traders to revisit their views. Meanwhile, unexpected disruptions in key production regions could upend these assumptions, pulling prices in the opposite direction. Goldman Sachs now projects Brent to reach $71 per barrel in December 2025, while WTI is forecast at $67 per barrel. Their latest estimate for next year’s global demand growth stands at 900,000 bpd, revised downward from an earlier 1.1 million bpd.
All of this leaves traders in a position where they must continuously reassess how these shifting pieces fit together.
