Goldman Sachs has outlined how falling oil prices could significantly impact non-OPEC+ production growth over the coming year. According to the bank’s analysis, for every $10 per barrel decline in oil prices when Brent crude is above $70, non-OPEC+ output growth is likely to slow by approximately 0.3 million barrels per day (mb/d) over a 12-month period. This sensitivity increases notably when prices are lower, highlighting the stronger supply response at reduced price levels.

When Brent trades between $50 and $70 per barrel, the effect on supply becomes more pronounced, with growth potentially falling by as much as 0.65 mb/d for each $10 price drop. Goldman notes that this asymmetric response reflects the economics of production, particularly for higher-cost producers in regions such as U.S. shale, where profitability becomes more strained at lower price points.

The findings underscore how price levels continue to shape the supply dynamics outside the OPEC+ alliance, influencing future market balances. With oil prices hovering around the $80 mark in early 2025, any sustained downturn could begin to slow non-OPEC+ growth, tightening the market over time and potentially supporting a price floor, especially if demand remains resilient.

Goldman Sachs adds that with recession risks rising, and elevated spare capacity, the medium term risks to their oil price forecast remain to the downside.