Goldman Sachs raises 2026 oil price forecast by 10% to $85/bbl

Analysts at Goldman Sachs have sharply raised their oil price forecasts for 2026, citing severe disruption to shipments through the Strait of Hormuz, which they described as the biggest supply shock ever to hit the global crude markets.

The prominent investment bank has expected that Brent crude futures will average $85 per barrel in 2026, an increase of 10.38 per cent from its earlier estimate of $77. Similarly, US West Texas Intermediate (WTI) is projected at $79 per barrel, up 9.72 per cent compared to the previous forecast of $72, analyst Daan Struyven said in a note.

The upward revision is based on the assumption that oil flows through the key Hormuz passage will operate at just 5 per cent of normal capacity for six weeks, before gradually normalising over the following month.

Oil markets have been roiled by the ongoing conflict involving the US, Israel and Iran, now in its fourth week with no clear end in sight. President Donald Trump over the weekend issued a two-day ultimatum to Tehran to reopen the critical shipping route or risk attacks on its energy infrastructure, prompting warnings of retaliation from Iran.