Analysts at Goldman Sachs have significantly increased their oil price predictions for 2026, attributing this to major disruptions in shipments via the Strait of Hormuz, considered the most significant supply shock to impact global crude markets. The investment bank anticipates Brent crude futures to average $85 per barrel in 2026, marking a 10.38% rise from their previous estimate of $77.
In a note, analyst Daan Struyven mentioned that US West Texas Intermediate (WTI) is forecasted to reach $79 per barrel, reflecting a 9.72% increase compared to the earlier projection of $72. The upward adjustment is premised on the expectation that oil flow through the crucial Hormuz passage will be at only 5% of its regular capacity for six weeks before gradually returning to normal over the subsequent month.
Amid the ongoing conflict involving the US, Israel, and Iran, now in its fourth week with no clear resolution in sight, oil markets have been unsettled. President Donald Trump recently issued a two-day ultimatum to Tehran to reopen the critical shipping route or face potential attacks on its energy infrastructure, eliciting warnings of retaliation from Iran.
Goldman Sachs highlighted that the unparalleled disruption could lead policymakers and investors to reevaluate the structural vulnerabilities in global energy supply, particularly the heavy reliance on production and spare capacity in the Middle East. Despite tightening supply conditions in Asia, crude inventories in OECD economies in the US and Europe are increasing, indicating that global supply had been surpassing demand before the conflict commenced.
