Goldman Sachs has issued a stark warning that Brent crude could surge past $120 a barrel by the fourth quarter if current disruptions to shipping through the Strait of Hormuz continue.
The investment bank’s analysis highlights the extreme tail risk facing global energy markets as geopolitical tensions in the region intensify, potentially overriding broader supply fundamentals.
The bank’s $120 scenario is not its primary forecast, but it underscores how quickly physical supply risks can eclipse macroeconomic demand concerns when trade routes are compromised.
While Goldman Sachs maintains that a significant global oil oversupply is its base case for 2027, the immediate threat to one of the world’s most critical energy chokepoints is reshaping near-term price dynamics.
The bank’s $120 scenario is not its primary forecast, but it underscores how quickly physical supply risks can eclipse macroeconomic demand concerns when trade routes are compromised.
The warning comes amid escalating violence in the Strait of Hormuz, where a tanker was recently hit and its crew evacuated following a projectile strike.
These incidents coincide with ongoing military strikes by the US against Iran, marking the tenth night of such operations.