Goldman Sachs Flags $120 Oil Risk As Middle East Attacks Intensify

Goldman Sachs says that oil prices could climb as high as $120 a barrel if attacks on Middle East shipping escalate, as per Bloomberg report.

This favors positions in natural gas and diesel to benefit from potential gains, as per the report.

Daan Struyven, co-head of global commodities research, said recent developments indicate a meaningful risk that shipping disruptions could expand and intensify.

Crude has risen to its highest level since July as the U.S. and Iran remain locked in a standoff over the Strait of Hormuz.

The conflict, now more than six months old, has lifted a broad range of energy prices, with natural gas and petroleum products outperforming crude. Industrial fuel diesel has more than doubled this year.

Brent was last trading near $92 at the time of writing this report.

While Goldman sees significant upside for crude, Struyven said investors should hedge geopolitical risks by going long on global natural gas and refined-oil products, as supply disruptions are larger in those markets than in crude.

Goldman Sachs also sees oil falling to $80 a barrel if regional exports return to normal, Struyven said.

Trump Expands To Fuel Costs

Last week, President Donald Trump urged oil companies to expand refining capacity in a bid to bring down fuel costs at the pump amid Iran war shocks, but it may not be as simple.

Renewed US-Iran strikes over the weekend sent crude sharply higher Monday, reviving inflation fears and pushing the 10-year Treasury yield to its highest since January 2025 as U.S. equities fell.

A report by the Wall Street Journal outlined Trump’s meeting with oil executives on Tuesday, in which he pushed for scaling refining capacity.

The report noted that expanding capacity could be a "tough sell" to oil producers, as building refineries may not be as profitable for the enterprises.

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