OPEC+ to Deliver Final Output Hike in August, Says Goldman Sachs
Goldman Sachs expects the eight-country OPEC+ core group to raise crude oil production by 0.41 million barrels per day (mb/d) in August, marking what it predicts will be the final output hike in the current cycle.
In a note released Sunday, the bank cited tight near-term market conditions, resilient global economic indicators, and the seasonal summer spike in demand as key factors underpinning the expected move.
“Relatively tight spot oil fundamentals, beats in hard global activity data, and seasonal summer support to oil demand suggest that the expected demand slowdown is unlikely to be sharp enough to stop raising production when deciding on August production levels on July 6,” said Goldman Sachs.
July Production: OPEC+ Holds Steady
OPEC+ stuck to its plan for July, announcing another 411,000 bpd production increase, consistent with hikes in May and June. The move was widely anticipated by markets, signaling the group’s intent to maintain supply discipline while gradually reclaiming market share.
According to Goldman Sachs, the decision is a reflection of:
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Tight spot oil fundamentals
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A resilient macroeconomic backdrop
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Ongoing internal balancing efforts to:
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Normalize spare capacity
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Reinforce unity among member states
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Check aggressive output from U.S. shale producers
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Market Reaction: Oil Prices Rise
Oil prices reacted positively to the OPEC+ move:
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Brent Crude and WTI both gained over $1 per barrel in early Asian trading Monday.
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The modest rally aligns with expectations that supply increases will be gradual, not disruptive.
Despite this rebound, Goldman Sachs maintains a cautious price outlook for the remainder of 2025 and into 2026.
Price Forecast: Bearish Tone Amid Long-Term Supply Growth
Goldman Sachs’ updated oil forecast shows:
| Year | Brent Crude (Avg) | WTI (Avg) |
|---|---|---|
| 2025 | $60/bbl | $56/bbl |
| 2026 | $56/bbl | $52/bbl |
The bearish outlook is shaped by a projected global supply surplus, particularly:
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+1 million bpd surplus in 2025
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+1.5 million bpd in 2026
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Driven primarily by non-OPEC growth, notably outside the U.S. shale space
The forecast assumes OPEC+ will hold output flat from September onward, anticipating a slowdown in global economic growth in Q3 and ramp-up in new non-OPEC projects.
Demand-Side Adjustments: The Case for Resilience
Goldman Sachs did make moderate upward revisions to its demand projections, citing:
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Revised IEA Africa demand estimates (historically undercounted)
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Surprisingly strong oil consumption in Europe
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A softer-than-expected EV penetration rate in the U.S. and EU
These demand-side developments offset part of the bearish supply effect, reinforcing the expectation that markets won’t collapse even as oversupply looms.
Key Takeaways for Investors and Analysts
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Short-term: Expect OPEC+ to raise production one last time in August before shifting to a holding pattern.
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Medium-term: Oil prices likely to remain capped due to mounting non-OPEC supply despite firm demand.
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Long-term: Structural shifts in transportation energy (EVs, fuel economy), African demand growth, and shale productivity will define the post-2025 oil balance.
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