SKN | Goldman Sachs Raises Q2 Brent Forecast to $76 as Hormuz Disruptions Threaten Oil Supply

Key Takeaways

• Goldman Sachs raised its second-quarter Brent crude forecast by $10 to $76 per barrel.
• The bank also lifted its WTI crude projection to $71 per barrel for Q2, up $9 from its previous estimate.
• Supply disruptions tied to tanker traffic through the Strait of Hormuz are driving the revised outlook.
• Analysts warn Brent could climb toward $100 if flows through the critical shipping route remain constrained for several weeks.

Forecast Revision Reflects Rising Supply Risks

Goldman Sachs has increased its second-quarter price forecast for Brent crude oil by $10 to $76 per barrel as escalating disruptions in Middle Eastern shipping routes raise concerns about tightening global supply.

The investment bank also revised its outlook for West Texas Intermediate crude oil, projecting the U.S. benchmark to average $71 per barrel during the April-to-June quarter, up $9 from its earlier estimate. The changes reflect growing uncertainty surrounding oil transportation through the Strait of Hormuz, one of the world’s most critical energy corridors.

Market Already Trading Above Forecasts

In Asian trading, crude prices were already exceeding Goldman’s updated projections. Brent crude traded above $83 per barrel, while WTI climbed above $76 per barrel, highlighting how rapidly geopolitical risks have shifted market sentiment.

Market participants are increasingly focused on the potential for prolonged disruptions to tanker traffic through the Strait of Hormuz, which carries a significant share of the world’s seaborne oil shipments.

Inventory Pressure Could Drive Higher Prices

Goldman Sachs analysts noted that sustained disruption to flows through the Strait could accelerate inventory drawdowns in advanced economies. If volumes remain constrained for an additional five weeks, the bank estimates Brent prices could approach $100 per barrel.

Such levels historically coincide with demand destruction, where higher prices begin to suppress consumption in order to stabilize global inventory levels.

Supply Shock Scenarios

The bank’s research outlines a range of potential outcomes depending on the severity and duration of shipping disruptions. Oil prices could rise between $1 and $15 per barrel depending on the scale of the supply shock.

A full one-month closure of the Strait of Hormuz without mitigation measures—such as strategic petroleum reserve releases or expanded pipeline use—could push oil prices higher by as much as $15 per barrel.

However, if Middle Eastern producers redirect shipments through available pipeline infrastructure, estimated at roughly four million barrels per day, the projected increase would likely be closer to $12 per barrel.

Strategic Importance of the Strait

According to estimates referenced by Goldman Sachs, about 16 million barrels per day of oil flows remain exposed to potential disruption if the Strait were fully closed. The International Energy Agency estimates that roughly 4.2 million barrels per day could be redirected using existing pipeline capacity, leaving a significant portion of global supply still vulnerable.

Outlook

The revised forecasts underscore how geopolitical tensions in key energy transit routes can quickly reshape global oil markets. While supply alternatives and strategic reserves could cushion the impact, prolonged disruptions to Hormuz traffic would likely intensify volatility and tighten global inventories.

For now, Goldman Sachs’ updated projections highlight the growing role of geopolitical risk premiums in determining near-term oil price dynamics.

For confidential discussions regarding geopolitical risk premiums in energy markets, strategic commodity allocation frameworks, oil supply disruption modeling, and portfolio positioning across global energy equities and crude benchmarks, our senior advisory team is available for discreet consultation tailored to institutional and cross-border mandates.