After opening higher this morning, Woodside Energy Group Ltd (ASX: WDS) shares have given back those gains to be right where they closed at yesterday.
In late morning trade on Friday, shares in the S&P/ASX 200 Index (ASX: XJO) energy stock are swapping hands for $24.00 apiece.
Perhaps not coincidentally, the Brent crude oil price is also trading at almost identical prices to 24 hours ago. At time of writing, Brent crude oil is trading for US$68.77 per barrel.
While that's up from lows of just US$60.20 per barrel on 5 May, the oil price has tumbled some 21% since this time last year.
As you'd expect, that's put pressure on Woodside shares, with the stock down 17.8% over 12 months.
As for the competition, rival ASX 200 energy stock Beach Energy Ltd (ASX: BPT) shares have slumped 11.5% over the full year. While the Santos Ltd (ASX: STO) share price is down a lesser 3.6%. Sanots shares received a big boost in April following the announcement of the potential, and ongoing, takeover offer from the XRG Consortium.
So, that's the year gone by.
Now, here's what Goldman Sachs is forecasting for the oil price in the year ahead.
How will the oil price impact Woodside shares heading into 2026?
With the Organization of the Petroleum Exporting Countries and its allies (OPEC+) discussing adding another 411,000 barrels per day to their voluntarily reduced production quotas in August, the potential of a global oil supply glut is ramping up.
In a forecast that could mean further headwinds for Woodside shares, along with Santos and Beach Energy, Goldman Sachs Head of Oil Research Daan Stryuven cautioned earlier this week that investors should prepare for Brent crude oil to fall by another US$10 per barrel heading into 2026.
"The main reason we look for oil prices to drop by another $10 per barrel over the next year is that we expect strong supply growth," Stryuven said.
He added:
In fact, we expect global supply this year to grow four times more quickly than demand, assuming no disruptions, with strong supply growth basically from two buckets of countries – the OPEC-plus producers that are unwinding their voluntary production cuts and then what we call non-OPEC, ex-US shale countries such as Brazil, Guyana, Norway, Kazakhstan, that are actually raising production by a million barrels per day between August and last month. So very rapid supply increases there.
While the US shale industry is not expected to be the main driver of supply growth this year, Stryuven noted:
In fact, we got an all-time high for US crude supply released earlier [Monday] for the month of April. So, I think this reinforces our view that supply growth will be strong and will push down oil prices, assuming you get no geopolitical surprise.
As for any global demand growth that could boost the oil price and by connection help support Woodside shares, Stryuven said, "I would characterise oil demand growth as pretty modest compared to history."
Goldman Sachs expects global oil demand to grow by 600,000 barrels per day this year.
