Ministers from OPEC nations and other oil-producing countries led by Russia, a group known as OPEC+, are due to meet next week to decide on output policy. Oil prices stayed within a narrow range ahead of the meeting, Reuters reported.

"Our base case is that policymakers leave the voluntary group cut unchanged given near-average inventory levels and time spreads, an already low Saudi market share, and OPEC’s strong demand forecast," the Wall Street bank said in a note on Tuesday.

It said there is a significant 35% subjective probability that major OPEC producers may announce a "deeper" group cut on Sunday, adding that OPEC policymakers may want to take out insurance against the possibility that Brent prices drop below $80/bbl amid weaker seasonal demand in Q1.

Goldman says that an announcement of a deeper cut could be shared across major OPEC+ producers and cover a relatively short period and be moderate in size.

"One option is a 0.5-1 million bpd cut through Q1 shared proportionally among the large producers which cut in April, including Saudi Arabia, Russia, the UAE, Iraq, and Kuwait."

Goldman says while oil prices would likely rise a few dollars in the scenario of a deeper 0.5-1.0 million barrel per day group cut in Q1, the immediate price reaction would likely skew neutral or to the downside in most other scenarios.

Saudi Arabia, Russia and other members of OPEC+ have already pledged output cuts of 5.16 million bpd, or about 5% of daily global demand, in a series of steps that started in late 2022.

The cuts include 3.66 million bpd by OPEC+ and additional voluntary cuts by Saudi Arabia and Russia.