The global oil market faces “large surpluses” this year and next as the trade war weighs on crude demand growth and OPEC+ eases supply curbs, according to Goldman Sachs Group Inc.

The worldwide crude market is expected to have a glut of 800,000 barrels a day in 2025, and a wider surplus of 1.4 million barrels a day in 2026, analysts including Daan Struyven said in a note.

Crude hit a four-year low this month as the trade war — especially the confrontation between the U.S. and China — stoked fears of a global recession that would hurt energy demand. A surprise OPEC+ decision to bring back shuttered output more quickly than expected has added to bearishness.

“While the market has already priced in some future inventory builds, we expect large surpluses in 2025,” and 2026 to further weigh on prices, the analysts said. At present, Brent is expected to average $63 a barrel over the rest of this year, a base case that assumes there’s no US recession and only a modest increase in supplies from OPEC+, they said.

Global demand will expand by only 300,000 barrels a day this year, with the sharpest slowdown seen in petrochemical feedstocks, they said.

Last week, the US slashed its forecast for global oil demand growth to about 900,000 barrels a day in 2025. That’s about 400,000 barrels lower than last month’s estimate. Later Monday, OPEC is due to release its monthly analysis, with the International Energy Agency due to follow on Tuesday.

Brent traded little changed at $64.87 a barrel on Monday, down by 13% this year. In recent weeks, Goldman Sachs has been among high-profile banks that have pruned price forecasts as the US-led trade war intensified, and the OPEC+ shift raised the prospect of additional supplies. 

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