Oil Price Surges Past $100 as Market Priced in Dual-Chokepoint Risk
The price of oil has surged past $100 per barrel as the market begins to price in the scenario that Goldman Sachs flagged months ago. This involves not just a constrained Strait of Hormuz, but also a simultaneous threat to the Red Sea exit used by Saudi Arabia for seaborne trade.
Goldman's commodities team warned in July 2026 that nearly 9 million barrels per day were moving through Bab el-Mandeb, with roughly 4 million potentially difficult to reroute if friction hit all three chokepoints at once. Their base case assumed Hormuz would stay usable enough for a Brent average near $80 in Q4 2026 and $75 in 2027.
However, the risk case was different: if Hormuz disruptions persisted into 2027, Brent could exceed $120 in Q4 2026 and average around $100 in 2027. Sustained friction across all three arteries added another $25 of upside on top of that.