Bloomberg

Tuesday, 21 July 2026 11:33 | 2 minutes read

From. Brent crude prices are expected to exceed $120 a barrel by the fourth quarter of the year if navigation disruptions through the Strait of Hormuz persist, and according to Goldman Sachs Group, this scenario does not represent the baseline expectation for markets experiencing wide fluctuations.

Analysts including Dan Struyven said in a note issued on July 20 that "the escalation of tensions in the Middle East and the estimated decline in Gulf flows to less than 45% of pre-war levels have pushed oil prices higher."

Goldman Sachs currently expects Brent crude to average $80 a barrel in the fourth quarter, before declining to $75 over the next year, based on the assumption that Middle East tensions ease. However, analysts see the risks surrounding these estimates as "tilted to the upside," given shipping disruptions through Hormuz and the possibility of them extending to the Red Sea.

Global energy markets have seen turmoil this month, with Brent crude rising back above $91 a barrel against the backdrop of renewed conflict between the United States and Iran, and threats from Tehran-backed Houthi rebels in Yemen to disrupt maritime navigation in the Red Sea. Oil flows through the Red Sea have played a pivotal role in delivering disrupted Gulf crude shipments to consumers.

Mon, 20 2026

Analysts said that the decline in global inventories during the second quarter made the oil market more vulnerable to supply shocks, but lower Chinese imports, along with increased demand elasticity, may limit the expected gains.

For investors seeking to hedge against ongoing geopolitical shocks from the Middle East and Russia, Goldman Sachs suggested a strategy of taking a long position on the spread between European diesel contracts for December 2026 and March 2027.

Disruptions Threaten Diesel Market

Analysts pointed out that diesel markets were suffering from severe shortages before the war, while Ukraine continued to target Russian refineries, alongside additional supply risks including hurricanes, summer heatwaves, and postponed facility maintenance.

Tue, 14 2026

Brent crude futures were at $88.65 a barrel in the latest trading, after peaking above $126 a barrel in late April during the first phase of the US-Iran conflict.

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