Goldman Sachs Foresees Oil Price Hike Amid Escalating Middle East Tensions

Goldman Sachs Group, the investment bank, has predicted a significant rise in oil prices, potentially reaching $120 per barrel, if attacks on shipping traffic in the Middle East escalate. The group recommended speculating on natural gas and diesel to capitalize on potential gains under this scenario. In a statement, Dan Strueven, co-head of global commodities research at Goldman Sachs, affirmed that "developments over the past few days indicate that the risk of expanding and intensifying shipping disruptions is a significant factor to consider." On the other hand, Strueven noted that oil prices could fall to $80 per barrel if the region's exports return to their normal levels. These warnings come as oil prices continue their ascent, driven by growing fears of a prolonged disruption in Middle East supplies. These concerns stem from the reciprocal attacks between the United States and Iran that targeted vessels in the Strait of Hormuz and other maritime areas. Oil prices saw substantial increases last week; Brent crude rose by 7.8%, while U.S. West Texas Intermediate crude gained about 10%. This surge followed the resumption of attacks between the two parties, leading to a decrease in oil flows through the Strait of Hormuz, which was a passage for one-fifth of global oil supplies before these events. In a related context, data released by Kepler on Monday showed that the average daily transit of commodity ships through the Strait of Hormuz reached only 10 vessels over the past ten days, marking its lowest level since May. Meanwhile, the "OPEC+" alliance announced its decision to keep its oil production policy unchanged for October, during its meeting held last Sunday. Analysts at ANZ Bank stated in an analytical note that the most probable scenario is a prolonged confrontation, interspersed with calculated military actions from the United States and Iran. This projection suggests a delay in the full recovery of Middle East supplies. They added that they anticipate exports to remain constrained through the remainder of 2026, before a gradual reopening in late Q4 2026, with flow levels not expected to return to pre-war levels until late Q1 or early Q2 of 2027.