Goldman Sachs raised its Brent and WTI price projections on Monday, citing a sharp drop in tanker traffic through the Strait of Hormuz that has kept energy markets on edge for six months. The bank now sees a path for Brent to breach $120 a barrel in 2027 if Gulf output stays 4 million barrels a day below pre-war levels, a dramatic widening from its base case of a 500,000-barrel shortfall.
Shipping data underscores the squeeze
Commodity vessels transiting the strait averaged just 10 per day over the past 10 days, the lowest rate since May, according to shipping data. The slowdown coincides with Iran's threat of economic retaliation against the United States, adding a fresh layer of geopolitical risk to a conflict that has already cycled through repeated periods of calm and flare-up. Benchmark prices have responded by climbing to a six-week high.
Inventory buffers limit the upside
Despite the shipping disruption, Goldman characterized its forecast increase as relatively modest. The bank noted that OECD commercial inventories have drawn down only limited amounts since the war began, and it expects Middle Eastern producers to keep rerouting supply flows as they have so far. That adaptation, combined with the inventory cushion, tempers the immediate price impact of the Hormuz bottleneck.
The 2027 range spans $60 to $120
At the other end of the spectrum, Goldman outlined a scenario where Brent slips into the $60s in 2027 if Gulf production recovers to 1 million barrels a day above pre-war levels. The wide spread between the two outcomes, more than $50 a barrel, reflects how much the market's direction still hinges on physical flows through a single chokepoint rather than on demand fundamentals.