Goldman Sachs Forecasts Gold to Reach $3,150/oz, Oil at $100/bbl by 2025 - Read Now

Goldman Sachs has made bold predictions for gold and crude oil prices for 2025, with both commodities expected to see significant price rises. According to the investment bank's latest report, gold could hit $3,150 per ounce by December 2025, driven by higher demand from global central banks and concerns over inflation and geopolitical risks. Meanwhile, oil prices are projected to rise to $100 per barrel, largely influenced by global supply disruptions and political tensions.

Gold Price Outlook: $3,150 per Ounce by 2025

Goldman Sachs analysts, led by Daan Struyven, have maintained their bullish outlook on gold, forecasting prices could climb as high as $3,150 per ounce by the end of 2025. This represents an upside of nearly 19% from the current price levels. The key driver for this surge, according to Goldman Sachs, is higher demand from central banks as they look to hedge against inflation and economic instability.

The analysts also cited inflationary pressures and US fiscal sustainability concerns as major factors contributing to gold’s appeal as a safe-haven asset. Central banks, particularly those holding large US Treasury reserves, may increase their gold holdings, which could significantly push up the price. This shift in demand is expected to add about 9% to the price of gold by December 2025, relative to their previous forecast of $2,640 per ounce made in November 2024.

Gold has long been seen as a hedge against sticky inflation, and with rising fears about fiscal risks in the US and other major economies, demand for the precious metal is expected to continue its upward trajectory. However, there are risks to this bullish forecast, including the possibility of higher interest rates and a stronger US dollar, which could dampen gold’s appeal in the short term.

UBS Also Bullish on Gold

Goldman Sachs isn't the only major financial institution bullish on gold prices. UBS also predicts that gold will see strong growth in the coming years. The bank’s base case for gold is $2,900 per ounce by December 2025, with the potential to reach $3,000 in an upside scenario. While UBS expects some short-term consolidation in gold prices, it believes the metal will finish 2024 modestly higher than current levels, with a year-end target of $2,700.

Oil Price Outlook: Brent Crude to Hit $100 by 2025

Goldman Sachs has also weighed in on the future of oil prices, forecasting that Brent crude will rise to $100 per barrel under a worst-case scenario involving geopolitical tensions. According to their latest forecast, Goldman Sachs expects oil prices to remain in the $70-85 per barrel range in the near term, with an average price of $76 per barrel in 2025. However, in the event of geopolitical disruptions, especially in the Strait of Hormuz or Iran, oil prices could surge to $100 per barrel.

The bank’s forecast considers potential supply disruptions, including US political developments and ongoing tensions in the Middle East, which could cause sharp price spikes. Goldman Sachs has also highlighted that Brent crude prices surged from a low of around $69 per barrel in early 2024 to $91 per barrel by April 2024, driven by rising geopolitical concerns.

Geopolitical Risks and Oil Price Volatility

Oil prices have always been sensitive to geopolitical risks, and Goldman Sachs anticipates that these factors will continue to influence global energy markets in 2025. The bank suggests that global supply imbalances, including a potential surplus in oil production from OPEC+ and the Americas, could offset some of the rising demand. However, in the event of supply disruptions, Brent crude prices could exceed expectations and hit $100 per barrel.

For the coming year, Goldman Sachs expects an oil surplus of about 0.4 million barrels per day in 2025, with demand growth estimated at 1.2 million barrels per day. Despite this, oil prices are forecast to peak at $78 per barrel in mid-2025, with a slight dip to $73 by December 2025.

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