Full Breakdown
Goldman Sachs Flags $120 Oil Risk Amid Escalating Gulf Shipping Attacks
9/9/2026, 4:36:24 AM
Core Forecast and Market Outlook
Goldman Sachs warned on September 7 that Brent could reach $120 a barrel if Gulf shipping attacks intensify. The bank’s “upside” scenario follows a recent base-case projection of $85 for Brent by year-end, with WTI near $80. In a “normal-export” view, Goldman sees Brent falling to $80 and $60 by 2027 if Gulf output rises by one million barrels per day. Options markets now assign a 25 % probability that Brent stays above $100 in March 2027, up from 6 % a month earlier.
Background of the Iran-U.S. Conflict
The war that began on February 28 between the United States (and Israel) and Iran has kept the Strait of Hormuz—a chokepoint for roughly one-fifth of global oil—under threat. U.S. forces have struck three Iranian oil tankers, while Iran’s Revolutionary Guard has targeted U.S. warships with ballistic missiles. Iranian officials have announced a new “restricted zone” extending from the U.S. naval blockade toward the Strait, threatening sanctions on any ship that attempts passage.
Data and Recent Price Movements
- Brent traded near $97 in early September, its highest level since July 23.
- The benchmark peaked at $114 on May 4.
- Diesel in the United States hit $5.90 per gallon on Labor Day, more than double a year earlier.
- A Brown University tracker attributes an additional $100 billion in U.S. fuel spending to the war, with gasoline accounting for roughly $55 billion and diesel $45 billion.
Official Statements & Responses
U.S. Treasury Secretary Scott Bessent told Fox News the energy-supply shock “is going to end” and suggested oil could fall to $40-$50 if “so much supply” returns.
Iran’s Mohsen Rezaei, secretary of the Supreme National Security Council, said any vessel entering the exclusion zone would be placed on a sanctions list.
The U.S. Navy continues to block Iranian ports and escort commercial tankers from other Gulf producers, reinforcing the maritime tension behind the price outlook.
Criticism & Opposition
Bessent’s low-price scenario challenges Goldman’s high-price warning, arguing that abundant supply could drive Brent below current levels. This divergence highlights uncertainty over how quickly regional exports might normalize despite ongoing hostilities.
Conflicting Reports & Gaps
Goldman’s analysis presents an upside of $120, a base case of $85, and a downside of $80 (or $60 by 2027). The probability shift for Brent staying above $100—from 6 % to 25 %—illustrates rapidly changing market expectations, yet no consensus exists on the timeline for a durable shipping-lane resolution.
Why It Matters
Higher oil prices raise gasoline and diesel costs for U.S. consumers, feeding broader inflation pressures. The Consumer Price Index is projected to show an annual 3.3 % rise in August, above the Federal Reserve’s 2 % target. Elevated fuel costs also increase transportation expenses for groceries and other goods, squeezing household budgets.
Verbatim Quotes
- “Events over the last few days do suggest that the risk of shipping disruptions broadening and intensifying is an important one,” — Daan Struyven
- “On the other side of this, we actually could see oil prices at $40 or $50 [a barrel] because there's so much supply coming on,” — Scott Bessent
- “Any ship that enters this area with the intention of passing through the Strait of Hormuz and is identified will be placed on our sanctions list,” — Mohsen Rezaei
