• Oil extended its climb this week as threats to shipping spread from the Strait of Hormuz to the Red Sea, putting two of the world’s key export routes under pressure at once.
  • Goldman Sachs kept its Brent forecast at $80 for the fourth quarter, expecting lower regional supply and falling inventories to hold prices up through the summer.
  • Beyond that, the bank sees the balance tipping the other way, with softer demand and a growing 2027 surplus capping how far prices can run.

Oil prices climbed again this week as renewed US-Iran strikes, threats to the Strait of Hormuz and growing shipping risks pushed geopolitical fears back into the market.

Trump’s Warning Over the Strait of Hormuz

President Trump warned Iran yesterday that any attacks on ships passing through the Strait of Hormuz would lead to US strikes on Iranian infrastructure, including bridges and power plants. ⁽¹⁾

The statement came as US forces carried out a 12th straight night of strikes against Iranian military targets. This followed the breakdown of an earlier ceasefire and the deaths of four American service members.

Diplomacy Fades as Tensions Escalate

While speaking at a meeting of Southeast Asian foreign ministers in the Philippines, Secretary of State Marco Rubio said that the US is still open to a diplomatic resolution but accused Iran of acting recklessly. ⁽²⁾

He pointed to a memorandum of understanding reached last month that Iran allegedly broke within two weeks. Rubio said the US would continue protecting shipping through Hormuz and called on other nations to help with that effort. He added that the president has several options if Iran continues to refuse cooperation. ⁽³⁾

Red Sea Shipping Threat

Tensions escalated further late yesterday after Yemen’s Houthis claimed they had attacked two Saudi oil tankers in the Red Sea.

UK Maritime Trade Operations confirmed that one tanker had been struck by an unknown projectile off the Saudi coast, causing a fire onboard, while the reported attack on the second vessel remained unconfirmed. ⁽⁴⁾

The Houthis declared a naval blockade against Saudi Arabia and warned that vessels at Saudi ports could be targeted. Saudi Arabia has redirected some of its oil exports through the Red Sea because of disruptions and security risks in the Strait of Hormuz. ⁽⁵⁾

Former US officials have warned that a broader response to the activity could place additional demands on American military resources. ⁽⁶⁾

Market Reactions and Goldman’s Outlook

Brent climbed toward $98 a barrel, while WTI approached $90, as traders priced in the risk of wider disruption across key Middle East shipping routes.

Renewed attacks between Russia and Ukraine on shipping and energy infrastructure in the Black Sea added another layer of supply risk. ⁽⁷⁾

Despite the recent spike, Goldman Sachs maintained its Brent forecast of $80 a barrel for the fourth quarter of 2026, based on an assumption that US-Iran tensions would de-escalate and regional oil flows would improve. ⁽⁸⁾

The bank said lower Middle East output could support prices, though stronger regional production in June and softer demand from China and the Middle East could reduce further gains.

Goldman expects oil to hold most of its recent gains through July and August as inventories fall, helped by lower regional supply, summer travel demand and slower OECD strategic reserve releases.

The bank forecasts a 2027 surplus of 3.2 million barrels per day but does not expect Brent to fall below the upper $60s, citing strategic stockpiling and the ongoing risk of supply disruptions. ⁽⁹⁾

Sources: ⁽¹⁾ ⁽²⁾ CNBC, ⁽³⁾ ⁽⁴⁾ ⁽⁸⁾ ⁽⁹⁾Reuters, ⁽⁵⁾ ⁽⁶⁾ Financial Times, ⁽⁷⁾ Trading Economics