Goldman Sachs raises oil forecasts as Hormuz crisis disrupts supply

Monday 23 March 2026 - 12:20

By: Dakir Madiha

Goldman Sachs raises oil forecasts as Hormuz crisis disrupts supply

Goldman Sachs has sharply increased its oil price outlook for 2026, citing what it describes as the largest supply shock in history driven by the near-total disruption of flows through the Strait of Hormuz.

The bank now expects Brent crude to average $85 per barrel this year, up from a previous forecast of $77, while West Texas Intermediate is projected at $79, compared with $72 earlier. The revised outlook reflects expectations that oil shipments through the strait will remain at only about 5 percent of normal levels for six weeks before gradually recovering over the following month.

Goldman estimates that cumulative production losses in the Middle East could exceed 800 million barrels, with peak disruptions reaching 17 million barrels per day. The Strait of Hormuz typically handles around 20 percent of global oil supply, making the disruption a major shock to international markets.

The crisis stems from the US and Israeli military campaign against Iran, which began on February 28 and led to Iranian actions that effectively halted commercial shipping in the strait. Data shows a sharp drop in traffic, with only a fraction of normal tanker movements recorded in early March.

The International Energy Agency has described the situation as the largest oil supply disruption on record, estimating that global supply fell by about 8 million barrels per day during March.

Goldman now forecasts Brent to average around $110 per barrel in March and April, with near-term prices likely to remain above $120. In a more severe scenario, the bank warned that oil prices could surpass previous peaks seen in 2008 and 2022.

Efforts to stabilize the market include a coordinated release of 400 million barrels from strategic reserves by International Energy Agency members. However, analysts say this measure may only provide temporary relief given the scale of the disruption.

The United States has also taken steps to ease pressure by allowing tankers carrying Iranian crude to pass through the strait. Despite these measures, Goldman expects a slower normalization of supply, raising its fourth-quarter Brent forecast to $80 per barrel, compared with $71 previously.