As geopolitical tensions in the Middle East continue to escalate, the risk of disrupted shipping through the Strait of Hormuz is sharply shifting sentiment in the crude oil market. As of the close on March 6, Brent crude futures stood at $93.60 per barrel, while U.S. WTI oil at $91.62 per barrel, marking the largest weekly gain since the outbreak of the Russia-Ukraine conflict in 2022.
Facing increasingly severe supply threats, several top investment banks have successively raised their price forecasts, warning that upside risks for oil prices are rapidly building.
Goldman Sachs: Brent Could Return to $100 if Hormuz Disruptions Persist
In their latest report released this week, Goldman Sachs analysts warned that Brent crude could potentially surge to $100 per barrel if exports through the Strait of Hormuz are disrupted for an extended period. The firm modeled multiple scenarios: the baseline case assumes current export levels at roughly 15% of normal continue for another five days, followed by a gradual recovery over a month, corresponding to a second-quarter average of $76 for Brent. However, if the low-flow state persists for an additional five weeks, the market could face a severe supply crunch, potentially pushing prices past the $100 threshold, reminiscent of levels seen after the Russia-Ukraine conflict began in 2022.
Goldman Sachs also noted that while this extreme scenario is not their baseline expectation, it highlights how geopolitical factors can rapidly upend supply-demand balances. The report emphasized that the market has not fully priced in the risk of supply disruptions; if the conflict spreads to oil production facilities, the sentiment reversal could be extremely sharp.
Barclays: Conflict Lasting Weeks Could See Brent Test $120
Compared to Goldman Sachs’ more cautious assessment, Barclays adopted a more aggressive stance. In a report released on Friday, the bank explicitly stated that if the Middle East conflict continues for several more weeks, Brent crude could test $120 per barrel. The Barclays research team stated directly: “These numbers might seem ‘too high,’ especially in light of widespread pessimism regarding the oil market outlook for this year. But we reiterate that fundamentals and risks are greater than when we witnessed these levels materialize during the Russia-Ukraine Conflict.”
The report pointed out that with the escalation of the conflict involving the U.S., Israel, and Iran, the Strait of Hormuz has effectively fallen into a state of “effective closure.” Since the conflict began, the volume of oil stranded on tankers in the Middle East Gulf has increased by 85 million barrels. More importantly, production shutdowns are already occurring in Kuwait and Iraq and could potentially spread to the UAE and Saudi Arabia over time.
Barclays also outlined a price path for an extreme scenario: if the situation continues to deteriorate, a 10% tail-risk scenario implies Brent could reach $150 per barrel by the end of the month. This judgment is based on the assessment that diplomatic avenues are rapidly narrowing following U.S. President Donald Trump’s Friday ultimatum demanding Iran’s “unconditional surrender.”
Market Logic Reshaped: From Glut Concerns to Geopolitical Premium
The backdrop to this oil price rally is that, just weeks ago, markets were pricing in a supply surplus for the year. Goldman Sachs had previously predicted that, absent major supply shocks, the world would face a surplus of 2.3 million barrels per day in 2026, with a full-year average forecast for Brent of only $60. However, the sudden shift in the geopolitical landscape is rapidly reshaping this logic.
The Strait of Hormuz handles the transit of approximately one-fifth of the world’s oil production and liquefied natural gas. Shipping activity has been thrown into chaos since Iran threatened to fire on passing vessels. Although U.S. shale oil production remains restrained and OPEC+ continues its production cut discipline, marginal disruptions on the supply side are sufficient to move the price center.
For consumers, continuously rising oil prices signal a resurgence in energy costs and inflationary pressures; for Middle Eastern oil producers and U.S. shale producers, it implies windfall gains. However, the market’s greater focus is this: if the conflict cannot be de-escalated in a timely manner, the current geopolitical premium may only be the beginning.
