Goldman Sachs Flags Upside Risks to Oil Prices Amid Ongoing Strait Disruptions

Goldman Sachs has flagged upside risks to oil prices in both the near term and into 2027, citing the persistence of several past large supply shocks.

The bank's base case assumes a gradual recovery in oil flows from April, with Brent easing to the $70s by the fourth quarter of 2026. However, Goldman Sachs warned that risks to the long-term outlook remain elevated due to the ongoing Iran war and uncertainty over the reopening of the Strait of Hormuz.

The Strait's disruption would be the largest on record, according to Goldman Sachs' analysis of past supply disruptions. The bank's base case assumes oil production normalizes within four weeks of a full reopening, but it flagged meaningful downside risks to long-term supply, particularly from Iran and offshore production.