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Goldman Sachs sees upside risk to its Brent and WTI oil price forecast in 2025 and 2026 from recent trade de-escalation, it said in a note.
The bank estimates around $3-4 per barrel of upside risk to its Brent and WTI oil price forecast of $60/bbl and $56/bbl respectively for the rest of 2025, and $56/bbl and $52/bbl respectively in 2026.
The US and China said on Monday that they would pause their tariffs for 90 days. Following the talks in Geneva over the weekend, the US said it will cut tariffs on Chinese imports to 30 per cent from 145 per cent while China said it would cut duties on US imports to 10 per cent from 125 per cent.
Goldman said that reduced recession risk has also reduced the probability of very low oil prices, although solid supply growth outside US shale may still push prices significantly lower.
The Organisation of the Petroleum Exporting Countries and its allies, called Opec+, are planning to boost oil exports in May and June, which is seen as possibly limiting oil's upside.
Oil prices fell to a four-year low last month on investor worries that the US-China trade war could depress economic growth and oil demand.
The bank said that while it sees some upside risk to its oil price forecasts, it still expects a significant hit from tariffs to US real income, global GDP, and global oil demand.
Brent crude futures were trading at $66.77/bbl by 1443 GMT, while US West Texas Intermediate (WTI) crude was at $63.85/bbl. -Reuters