Goldman Sachs published its indicators update on 1 September. The headline was the global Current Activity Indicator (CAI) for July: 3.4% annualised. That is a monthly impulse, not annual GDP. Developed markets ran at 2.6%, emerging markets at 4.4%, India at 7.7% and China at 4.7%.
Fig. 1. Goldman Sachs Current Activity Indicator for July 2026, % annualised. Data: Goldman Sachs.
On 2 October stocks were 0.6% above the five-year average. By 23 October they were 3.8% below it. The turn over three weeks matters more than the 1.9 million headline.
Fig. 2. US crude stocks' deviation from the five-year average; 23 October: -3.8%. Data: EIA.
If the war de-escalates, the $84 forecast for 2027 shows how much downside is embedded. A strong CAI is no reason to buy oil blindly: demand will not rescue the market if supply falters again.
What the number says
The CAI is built from dozens of indicators and tracks momentum better than quarterly GDP. It is not Goldman's MAP surprise index: the CAI measures activity, the MAP measures deviation from consensus. In July activity was above trend almost everywhere, though developed markets were only modestly above potential.Fig. 1. Goldman Sachs Current Activity Indicator for July 2026, % annualised. Data: Goldman Sachs.
The buffer disappeared
Two months later came the EIA release for the week to 23 October. Commercial crude stocks fell by 1.892 million barrels to 410.6 million. A Reuters poll expected a 15,000-barrel rise: the market got both the sign and the size wrong.On 2 October stocks were 0.6% above the five-year average. By 23 October they were 3.8% below it. The turn over three weeks matters more than the 1.9 million headline.
- distillates: -1.5 million, 10% below the five-year average;
- gasoline: +3.9 million, but 2% below average;
- refinery runs: 16.5 million b/d, 92.8% utilisation;
- total petroleum inventories: -3.0 million.
Fig. 2. US crude stocks' deviation from the five-year average; 23 October: -3.8%. Data: EIA.
What it means for price
On 29 October Brent trades near $110 and WTI near $101. The market is pricing fragile supply, not weak demand. EIA expects Brent at $105 in Q4 2026 and $84 in 2027, but that assumes Middle East flows recover. If activity holds and logistics do not normalise, prices have little cushion: crude and distillates are already below normal.If the war de-escalates, the $84 forecast for 2027 shows how much downside is embedded. A strong CAI is no reason to buy oil blindly: demand will not rescue the market if supply falters again.
⚠ IMPORTANT
Strong activity and thin inventories are a dangerous mix: every supply disruption costs more. Oil is held up by fear about supply, not demand.