Rising tensions in the Middle East have put global energy markets on high alert, with Goldman Sachs cautioning that any major disruption to shipments through the Strait of Hormuz could trigger sharp spikes in oil and natural gas prices worldwide.
The investment bank’s warning, delivered in a note to clients on Sunday, reflects growing market anxiety amid the escalating confrontations between the U.S., Israel, and Iran.
Goldman estimates that should oil flows through the Strait—one of the world’s critical energy chokepoints—be halved for a month, followed by a period of reduced capacity for nearly a year, Brent crude prices could briefly soar to $110 a barrel.
Although such a spike would be transitory, the bank believes prices would remain elevated, averaging $95 in the final quarter of 2025.
Oil prices rallied to their highest levels since January after U.S. forces joined Israeli military operations against Iranian nuclear sites over the weekend, underscoring the market’s sensitivity to geopolitical risk premiums.
Goldman’s research also points to data from Polymarket—an online betting platform—showing a 52% market-implied probability that Iran will attempt to close the Strait of Hormuz in 2025, although liquidity on these prediction markets remain relatively narrow.
Further, Goldman outlined scenarios for Iranian oil supply disruptions. A sustained loss of 1.75 million barrels a day for six months could see Brent crude top out at $90 per barrel before easing into the $60s by 2026.
If production losses prove more durable, Brent could still peak at $90, but then stabilize in the $70–$80 range in 2026, buffered by depleted inventories and reduced spare global capacity.
Beyond oil, European natural gas prices are also at risk. Goldman projects that the TTF benchmark may reflect higher supply fears, with prices potentially climbing toward EUR 74/MWh ($25 per MMBtu) if the crisis escalates.
However, U.S. natural gas prices are expected to remain relatively insulated, given limited reliance on LNG imports and robust domestic export infrastructure.
Despite volatile recent headlines and shifting alliances in the Middle East, Goldman Sachs believes key economic players—including the U.S. and China—retain a strong incentive to prevent a prolonged, severe shock to global oil supply channels.
Decisions on any move to block the Strait rest with Iran’s Supreme National Security Council, according to state media, after parliament lent broad backing to the controversial measure in the wake of U.S. airstrikes.
