A perfect storm of geopolitical tensions—Trump’s aggressive tariffs and OPEC’s supply surge—has sent oil prices spiraling, with Goldman Sachs predicting further pain ahead.
Geopolitical Breakdown:
- U.S.-China Trade War:
- New 25% tariffs on Chinese goods → Lower shipping demand
- LNG exports to Asia slowing
- OPEC’s Strategic Blunder:
- Miscalculated demand recovery
- Russia prioritizing revenue over market stability
- Middle East Tensions Failing to Lift Prices:
- Despite Houthi attacks, supply remains high
- Iran sanctions enforcement weakening
Goldman’s Warning:
- “Market no longer responds to supply shocks like before”
- Need for deeper OPEC+ cuts to stabilize prices
- Risk of $65 oil if inventories keep rising
