Hormuz Attacks Threaten $120 Oil as Shipping Disruptions Intensify
Goldman Sachs has issued a warning that oil prices could surge to as high as $120 per barrel if attacks on the Strait of Hormuz continue. This would mark the highest price level since the US and Israel launched their war on Iran on February 28.
The current Brent crude price is above $97 per barrel, with Goldman Sachs' Daan Struyven stating that 'events over the last few days do suggest that the risk of shipping disruptions broadening and intensifying is an important one.'
The US and Iran have been unable to resolve their stalemate over the management of the Strait of Hormuz, which accounts for one-fifth of the world's oil shipments during peacetime.
Tehran has announced new sanctions for ships attempting to pass through the strait, with a 'new exclusion zone' to be unveiled in the coming days. Any ship entering this restricted area would be added to a sanctions list, according to Mohsen Rezaei, secretary of Iran's supreme national security council.
The renewed tensions have led to a significant decrease in shipping traffic through the Strait of Hormuz, with an average of ten commodity ships transiting the strait each day over the past 10 days, down from more than 15 on Friday and nearly 13 on Saturday.