– Projects oil price decline
– Copper remains favored industrial metal
London — Goldman Sachs sees gold prices climbing 14% to $4,900 per ounce by December 2026 in its base case, it said in a note on Thursday, while citing upside risks to this view due to a potential broadening of diversification to private investors.
In a note in which the bank discussed its views on commodities for 2026, Goldman Sachs said it expects structurally high central bank demand and cyclical support from U.S. Federal Reserve interest rate cuts to lift the price of gold. It continues to recommend long exposure in the yellow metal.
Spot gold was trading at $4,334.93 per ounce at 1824 GMT on Thursday.
The bank also forecast the price of copper to consolidate in 2026 and average $11,400 per metric ton under its base case that uncertainty over tariffs will linger until a possible announcement in mid-2026 that the U.S. will implement tariffs on refined copper in 2027.
“Despite the recent rally in copper prices and our expected consolidation in 2026, it remains our ’favorite’ industrial metal, especially in the long-run, as electrification – which drives nearly half of copper demand – implies structurally strong demand growth and as copper mine supply faces unique constraints,” Goldman noted.
Benchmark three-month copper on the London Metal Exchange was little changed at $11,721.50 per metric ton as of 1723 GMT on Thursday. It hit a record high of $11,952 last week.
The bank forecast Brent and WTI crude oil to decline further to 2026 averages of $56 per barrel and $52 per barrel, respectively.
“Barring large supply disruptions or OPEC production cuts, lower oil prices in 2026 will likely be required to rebalance the market after 2026,” it added.
Brent crude was trading at $60.04/bbl at 1711 GMT on Thursday. U.S. West Texas Intermediate crude was near $56.46/bbl.
Goldman expects oil prices to hit their lowest point around mid-2026, as markets begin to anticipate a rebalancing. The note added that this will be driven by solid demand growth of about 1.2 million barrels per day, further declines in Russian supply if the war in Ukraine and sanctions persist, and slowing non-OPEC ex-Russia output.
“We see net downside risks to our 2026-2027 oil price outlook,” Goldman noted.
However, the bank said it assumes oil prices will pick up in the fourth quarter of next year as the market starts pricing in a return to a deficit in the second half of 2027 and shifts focus to incentivizing long-cycle production.
It added that it expects the prices of Brent and WTI to gradually recover to $80/bbl and $76/bbl, respectively, by late 2028.
For natural gas, the bank said it forecasts 2026 Title Transfer Facility (TTF) at 29 euros per megawatt-hour (EUR/MWh) and 2027 TTF at 20 EUR/MWh, to incentivize additional gas demand, while it expects 2026 and 2027 U.S. gas prices to incentivize U.S. gas production growth at $4.60 per million British thermal units (mmBtu) and $3.80/mmBtu, respectively.
Goldman Sachs said it expects U.S. power spare capacity to decline further as rapid power demand growth and coal retirements outweigh renewable and natural gas power builds.
“As a result, US power markets are at risk of significantly higher prices and even outages. This risk is particularly acute in local power markets where data centers are booming, with 72% of all US datacenters sitting in 1% of US counties,” it added.
