As the world’s top investment manager and financial market journalist, I am here to provide you with the latest insights on the impact of the upcoming U.S. presidential election on the oil market. According to Goldman Sachs, the winner of the election will have limited tools to boost domestic oil supply next year.
The bank highlighted that strategic petroleum reserve stocks are low, and any regulatory easing may only have a modest effect on long-term U.S. oil supply. Despite this, oil prices saw a slight increase after the release of positive U.S. economic data, leading to higher expectations for crude oil demand from the world’s largest energy consumer.
Currently, the futures contract for September is trading around $82 a barrel, while U.S. West Texas Intermediate crude for September is around $78. Goldman Sachs projects Brent prices to range from $75 to $90 in 2025, assuming steady GDP growth and oil demand, along with market balancing efforts by OPEC and its allies.
However, there are potential risks to oil prices in the coming years. The bank forecasts that oil prices could drop by as much as $11 per barrel next year if weaker demand and GDP result from a 10% across-the-board tariff on imports by the U.S. Additionally, a delay in interest rate cuts by the Federal Reserve beyond 2025 could lead to a $19 impact on oil prices, with Brent potentially falling to $62 in the fourth quarter of 2025.
In conclusion, it is essential for investors to closely monitor the developments in the oil market, especially in light of the upcoming U.S. presidential election and potential trade policy changes. By staying informed and being prepared for various scenarios, investors can make informed decisions to protect their finances and navigate the volatile oil market landscape.