Oil futures began trading slightly below last week’s closing prices amid escalating geopolitical tensions. As President Trump approaches the end of a 48-hour ultimatum for Iran, futures for Brent crude, the international benchmark, initially surged but soon retreated, settling around $106 per barrel. Meanwhile, West Texas Intermediate (WTI) crude, the U.S. benchmark, was trading at approximately $97.90 per barrel.
In a dramatic post on Truth Social Saturday evening, President Trump issued a stark warning to Iran, demanding they “FULLY OPEN, WITHOUT THREAT, the Strait of Hormuz.” He further threatened that the United States would “hit and obliterate their various POWER PLANTS,” starting with the largest, if the demands were not met within 48 hours. This rhetoric follows a week marked by Iranian attacks on energy infrastructure in the Gulf, including a notable strike on Qatar’s Ras Laffan LNG export terminal, the largest of its kind in the world.
Amid these turbulent developments, Goldman Sachs’ oil desk adjusted its price forecasts, anticipating Brent crude may rise to $110 per barrel from March to April, a significant increase from an earlier prediction of $98 per barrel. The financial institution also considers a prolonged disruption in Hormuz flows, which may drop to just 5% of normal capacity for an extended period.
For the longer term, Goldman now estimates an average price of $85 per barrel for Brent and $79 per barrel for WTI in 2026, up from previous estimates of $77 and $72, respectively. Looking further ahead to 2027, the projections stand at $80 for Brent and $75 for WTI.
The Goldman team, which includes Daan Struyven, Yulia Grigsby, and Alexandra Paulus, noted that in the short term, the market may need to incorporate a growing risk premium to account for possible energy shortages due to threats from geopolitical conflicts. They suggest that heightened awareness of risks tied to the concentrated nature of oil production and available spare capacity could lead to increased strategic stockpiling and higher long-term prices.
