Goldman projects oil prices to decline and sees gold at $4900 by December 2026. Copper remains the preferred industrial metal.
Goldman Sachs believes that gold prices will rise 14% by December 2026 to $4,900 an ounce in its base scenario. However, the firm warned of upside risks due to potential diversification with private investors.
Goldman Sachs stated that it expected cyclical support and structurally high demand from central banks to boost the price of gold in a note where they discussed their views on commodities. Goldman Sachs continues to advise long exposure in yellow metal.
At 1824 GMT, spot gold was priced at $4334.93 an ounce.
The bank forecasted that copper prices would also consolidate by 2026, averaging $11,400 per ton. This is based on its "base case" that tariff uncertainty will last until the U.S. announces tariffs for refined copper as early as mid-2026.
Goldman stated that despite the recent rally in copper prices, and our anticipated consolidation in 2026 it is still our "favorite" industrial metal. This is especially true in the long run, because electrification, which accounts for nearly half of the copper demand, implies a structurally strong growth in demand, and the copper mine supply faces unique restrictions.
The benchmark three-month copper price on the London Metal Exchange remained unchanged at $11,721.50 a metric ton on Thursday, 1723 GMT. Last week, it reached a record-high of $11,952.
The bank predicted that Brent crude oil and WTI crude will?decline even further? to averages of $56 and $52 barrels in 2026, respectively.
It added that "barring major disruptions in supply or OPEC production reductions, lower oil prices will be needed to rebalance market after 2026,"
Brent crude traded at $60.04/bbl on Thursday at 1711 GMT. U.S. West Texas Intermediate Crude was around $56.46/bbl. Goldman predicts that oil prices will reach their lowest point in mid-2026 as the markets start to anticipate a rebalancing. This will be due to a solid growth in demand of about 1.2m barrels a day, a further decrease?in Russian supplies if the conflict in Ukraine and sanctions continue, and slowed non-OPEC ex Russia output.
Goldman stated that "we see net downside risk to our oil price forecast for 2026-2027."
The bank believes that oil prices will rise in the fourth quarter next year, as the market begins pricing in the return of a deficit for the second half 2027 and shifts its focus to encouraging long-cycle production.
It also added that they expect the price of Brent and WTI will gradually recover, reaching $80/bbl apiece and $76/bbl by late 2028.
The bank stated that it forecasts Title Transfer Facility (TTF), which is a payment facility for natural gas, at 29 euros per Megawatt-hour (EUR/MWh), in 2026, and at 20 EUR/MWh in 2027, to "incentivize" additional gas demand. It also expects U.S. Gas prices of $4.60 and $3.80 per million British Thermal Units (mmBtu), respectively, to encourage U.S. Gas production growth.
Goldman Sachs expects the U.S. As coal power is retired and power demand grows, power spare capacity will continue to decrease.
As a result of this, the US power market is at risk for significantly higher prices or even blackouts. The risk is especially acute in local markets, where data centers are growing rapidly. 72% of US datacenters are located in just 1% of US counties, it said. Reporting by Anjana Anil in Bengaluru and Anmol Chaubey, with editing by Matthew Lewis
(source: Reuters)
