Goldman Sachs Warns of Potential Oil Price Surge to $120

Goldman Sachs has warned of a potential oil price surge to $120 per barrel if shipping attacks in the Middle East intensify. The bank's commodity research team, led by Daan Struyven, believes that disruptions to exports from the region could lead to higher prices.

The current Brent price is around $97, but Goldman Sachs predicts it could reach $120 if tensions escalate further. Conversely, if regional exports normalize, the price could fall to $80 per barrel.

Struyven also emphasized the importance of hedging against geopolitical risks by investing in natural gas and refined oil products, which he believes have bigger supply shocks than the crude market.

The ongoing standoff between the US and Iran has already led to a boost in energy prices, with industrial fuel diesel having more than doubled this year. China's role as a stabilizing force in the crude market is also being closely watched, according to Goldman Sachs.