Goldman Sachs: Oil Price Surge Could Trim Global Growth by 0.4 Percentage Points

Oil prices rising to $100 per barrel could dampen global economic growth. Goldman Sachs analysts estimate that an increase to that level could trim global growth by about 0.4 percentage points. With an exchange rate of 1 US dollar equal to 16,925 rupiah, a $100 price equates to about Rp 1,692,500 per barrel. In the baseline projection, the oil price is expected to rise modestly before easing gradually. The average price is projected to reach $76 per barrel in Q1 2026, or about Rp 1,286,300. It is then forecast to fall to $65 per barrel in Q4 2026, or around Rp 1,100,125. The optimistic scenario foresees prices briefly touching $100 per barrel before returning to normal throughout 2026. The impact on the global economy is assessed as limited if the price increase remains moderate. In the baseline scenario, Goldman renders a drag of about 0.1 percentage points on global GDP growth. Global headline inflation is projected to rise by about 0.2 percentage points. If prices surge to $100 per barrel, global headline inflation could rise by as much as 0.7 percentage points. In the baseline scenario, the prospects for global monetary policy are not expected to change much. The direction of interest rates is expected to stay in line with the trend. A different picture emerges if oil prices breach $100 per barrel or if higher energy costs are passed through to consumer prices more broadly. Central banks could delay rate cuts, particularly in developing markets. High oil prices risk eroding households’ real incomes and consumer spending. Oil-exporting nations such as Canada and several Latin American countries stand to gain from higher energy export receipts. In the near term, movements in energy prices will influence inflation, purchasing power, and the trajectory of global interest-rate policy.