Goldman Sachs has delivered a blunt message to an oil market gripped by war, shipping attacks and renewed inflation fears: crude prices may remain dangerously volatile, but the partial recovery of Persian Gulf exports is limiting how high they can sustainably climb.
New York | Published at 12:18 p.m. ET
Goldman Sachs has delivered a blunt message to an oil market gripped by war, shipping attacks and renewed inflation fears: crude prices may remain dangerously volatile, but the partial recovery of Persian Gulf exports is limiting how high they can sustainably climb.
That assessment is being tested in real time.
Brent crude rose above $92 a barrel on Tuesday, while West Texas Intermediate traded near $88, after two tankers carrying Saudi oil were struck near the Strait of Hormuz. Each vessel was reportedly carrying roughly 2 million barrels of crude. The crews were reported safe, but the attacks immediately revived fears that one of the world’s most important energy corridors could become even more hazardous or effectively unusable for major commercial shippers.
The price reaction was swift because the Strait of Hormuz is not an ordinary shipping lane. Before the current conflict, approximately one-fifth of global petroleum liquids moved through the waterway. A prolonged interruption would affect refiners, airlines, trucking companies, manufacturers and consumers far beyond the Middle East.
Yet Goldman’s latest analysis challenges the most extreme interpretation of the crisis. The bank estimates that total Persian Gulf oil exports have recovered to approximately 15 million to 16 million barrels per day. That remains 7 million to 8 million barrels below prewar levels, but it is also 5 million to 6 million barrels above the market’s March low.
The blunt conclusion is that the oil trade is adapting faster than the headlines suggest.
“The rise in dark crossings by specialized shippers and in ship-to-ship transfers shows that producers and shippers are adapting to the Mideast conflict,” Goldman Sachs analysts wrote in a note reported by Reuters.
That adaptation could moderate the upside for crude even if regional disruptions continue. It does not mean the danger is over. It means the global oil system is finding expensive, opaque and increasingly risky ways to keep barrels moving.
Oil Is Flowing, Just Not Normally
Goldman’s estimate matters because conventional vessel-tracking systems may be understating actual Gulf exports.
Some tankers are sailing with their Automatic Identification System transponders disabled or transmitting incomplete data. Other cargoes are being transferred between ships outside the most closely monitored areas. These practices make it difficult to establish precisely how much oil is crossing the region at any moment.
Goldman used two independent methods to estimate total Gulf exports, according to the published account of its research. Its analysis suggests that actual flows are significantly higher than the volumes visible through ordinary ship-tracking data.
The bank believes flows specifically through the Strait of Hormuz could be approximately 8 million to 10 million barrels per day. Maritime intelligence company Kpler separately revised its estimate to about 8.6 million barrels per day after accounting for previously untracked tanker movements and ship-to-ship transfers.
These figures explain why crude has not returned to its wartime peak. Brent climbed to roughly $118 a barrel in April, according to Goldman Sachs Research, before retreating sharply as the market recognized that some exports were continuing despite the disruption.
The evidence now points to an oil market operating through workarounds rather than experiencing a total physical shutdown. Those workarounds are preventing an even more severe shortage, but they come with substantial costs.
Tankers may require additional security. Insurers may charge war-risk premiums. Ship-to-ship transfers create logistical and environmental hazards. Vessels operating without standard tracking can become more difficult to identify during emergencies. Refiners may also face longer delivery schedules and less certainty about when specific cargoes will arrive.
Goldman’s position is therefore not that oil has become safe or cheap. Its message is narrower and more disciplined: a conflict does not automatically produce an unlimited price increase when exporters and shipping companies continue finding ways to deliver supply.
Tuesday’s Attacks Expose the Weak Point
The danger embedded in Goldman’s assessment became visible again when the Saudi-flagged Sidr and the Liberian-flagged Senegal Prosperity were hit near Khasab, Oman.
The vessels were struck within minutes of one another while leaving the strait, according to shipping intelligence firms cited by Reuters. The incidents represented a serious escalation because they targeted loaded tankers rather than merely threatening shipping access.
Brent gained roughly 2 percent and reached its highest level in about a week. WTI also advanced as traders assessed the possibility that additional operators could suspend voyages or that insurers could impose more restrictive conditions.
This is the central vulnerability in Goldman’s outlook. The bank’s moderating argument depends on barrels continuing to move. If physical exports hold near 15 million to 16 million barrels per day, the market may absorb the disruption without returning to April’s extreme prices. If tanker attacks cause those flows to collapse, today’s restrained pricing logic could fail quickly.
Oil prices are not determined only by the amount of crude being produced. They also reflect whether that crude can reach a buyer, whether a ship is willing to carry it, whether an insurer will cover the voyage and whether a refinery can obtain the correct grade at the required time.
A barrel trapped behind a military blockade or a navigable choke-point cannot satisfy demand in New York, Rotterdam, Singapore or Tokyo.
The Crude Market Is Only Part of the Problem
Goldman sees greater upside risk in European natural gas and longer-dated refined-product contracts than in crude itself if disruptions persist.
That distinction deserves attention. Consumers do not purchase crude oil. They purchase gasoline, diesel, heating fuel and airline tickets. A relatively contained Brent price does not guarantee relief at the pump if refineries, pipelines or product tankers remain disrupted.
Asia’s imports of refined fuels fell to approximately 5.1 million barrels per day in August, their lowest level since the Iran conflict began, according to Reuters. That was about 2 million barrels per day below prewar volumes. Refining damage in the Middle East, disruptions affecting Russian fuel supplies and shipping insecurity have placed particular pressure on diesel and jet fuel.
The result is an unusual market in which crude availability can improve while the finished products needed by households and businesses remain tight.
That helps explain why Goldman’s warning cannot be reduced to a simple prediction that oil prices will fall. Its analysis suggests that crude’s immediate ceiling may be lower than feared because hidden and unconventional exports are reaching the market. At the same time, the wider energy system remains exposed to shortages, elevated refining margins and transportation costs.
In practical terms, Brent could retreat while diesel stays painfully expensive.
Demand Has Already Taken a Hit
High prices and constrained fuel availability are also damaging demand.
The International Energy Agency expects global oil consumption to decline by an average of 1.6 million barrels per day in 2026. It estimates that demand contracted by 4.9 million barrels per day during the second quarter and by 2.8 million barrels per day in the third quarter before an expected return to modest growth during the final three months of the year. The agency attributes part of that weakness to disrupted supply chains and elevated fuel prices. Its findings are detailed in the IEA’s August Oil Market Report.
Goldman previously estimated that the world experienced between 4 million and 5 million barrels per day of demand destruction in April. That assessment reflected not merely consumers choosing to drive less, but reduced product availability and economic activity associated with the Hormuz disruption.
This introduces a harsh self-correcting mechanism. Oil shortages raise prices. Higher prices weaken consumption and economic activity. Weaker consumption then limits how far crude can continue climbing.
The correction is not painless. It can arrive through reduced household purchasing power, higher transportation costs, canceled travel, weaker industrial production and slower economic growth.
Goldman’s message to investors is therefore also a message about the economy. Oil may struggle to sustain its most extreme wartime prices because the global economy eventually cannot absorb them.
American Consumers Still Face an Inflation Threat
For the United States, the consequences extend beyond gasoline stations.
Energy costs influence freight rates, food distribution, airline fares, plastics, chemicals and manufacturing. A prolonged period of crude above $90 can complicate efforts to control inflation, particularly if diesel and refined-product prices remain elevated.
Goldman has previously estimated that higher gasoline prices place a disproportionate burden on lower-income households. The bank’s consumer research found that the lowest-income quintile spends roughly four times as much on gasoline as a share of after-tax income as the highest-income quintile. That makes an energy shock regressive even when employment and headline economic growth remain resilient.
The price of oil also matters to the Federal Reserve. Central bankers often look through temporary energy volatility, but repeated fuel increases can affect inflation expectations and spread into transportation, goods and service prices.
Tuesday’s market movements showed that concern spreading beyond commodities. Rising oil prices contributed to pressure in global bond markets as investors considered whether elevated energy costs could keep inflation higher and interest rates restrictive for longer.
The Forecast Is a Conditional Warning, Not a Promise
Goldman has revised its oil forecasts repeatedly as military conditions, shipping access and demand have changed. That is not necessarily inconsistency. It reflects a market in which a single attack, ceasefire, blockade decision or shipping breakthrough can alter millions of barrels per day of expected supply.
The bank’s more recent base case has placed Brent around $80 a barrel for late 2026 and approximately $75 in 2027 if de-escalation continues and Hormuz flows improve. The U.S. Energy Information Administration, using its own assumptions, has forecast Brent averaging about $85 during the third quarter before declining toward $78 in the fourth quarter as traffic and production recover. The agency’s current assumptions are available in its Short-Term Energy Outlook.
Those forecasts now sit below Tuesday’s market price. That gap represents the premium traders are placing on immediate geopolitical danger.
It would be a mistake to read Goldman’s assessment as a declaration that prices cannot rise. The bank is identifying a force that restrains prices: more Gulf oil is reaching buyers than standard tracking initially indicated.
The opposing force is equally clear. Tankers carrying millions of barrels are being attacked near the world’s most important oil chokepoint.
The next decisive move will depend on which force wins.