Goldman warns Brent crude could hit $120 if Hormuz disruptions persist

The recent escalation in geopolitical tensions has put the oil markets on high alert, with the US president’s latest threat coinciding with a notable rise in oil prices. Goldman Sachs has issued a warning that Brent crude could surge to $120 per barrel if disruptions in the Strait of Hormuz persist into the fourth quarter. The oil benchmark has already climbed to $91 a barrel amid the ongoing conflict, which has lasted nearly five months.

The prediction of a potential spike in Brent crude comes at a time when Goldman Sachs has already adjusted its 2026 Brent forecast from $77 to $85 per barrel, reflecting heightened risks in the market. The Strait of Hormuz, a critical chokepoint for global oil supplies, remains a focal point of concern, as any prolonged disruption could severely impact oil supply routes. Current market pricing suggests participants are closely monitoring these geopolitical developments, with implications for WTI crude oil prices.

Market data indicates a significant shift in expectations, with a notable increase in the probability of WTI crude hitting $90 in July, currently priced at 45.1% YES. This aligns with the broader sentiment that ongoing tensions may sustain elevated oil prices, particularly if the situation in the Strait of Hormuz remains unresolved.

Key Takeaways

• The US president’s threat and the ongoing conflict have led to heightened concerns in the oil markets.
• Goldman Sachs’ projection of Brent crude reaching $120 if disruptions persist suggests significant supply risks.
• Market pricing indicates a substantial increase in the likelihood of higher WTI crude oil prices in the near term.

What to Watch

Observers will focus on developments in the Strait of Hormuz, as prolonged disruptions could further elevate oil prices. Key actors, including OPEC+ and the International Energy Agency, may influence market dynamics through potential production adjustments or strategic releases. Any diplomatic resolutions or escalations involving the US and Iran will be critical factors that could shift current market expectations. Markets appear to interpret ongoing tensions as supportive of scenarios where oil prices remain high.

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Disclosure: This article was edited by Estefano Gomez. For more information on how we create and review content, see our Editorial Policy.