Goldman Forecasts $120 Brent; Base Case Remains at $80
The investment bank projects crude could surpass that mark in the fourth quarter of 2026 if the disruption to transit through the Strait of Hormuz does not ease.
Goldman Sachs on July 23 projected a scenario in which Brent exceeds $120 per barrel in the fourth quarter of 2026 if the disruption to crude transit through the Strait of Hormuz persists. Its central forecast, however, remains at $80.
The analysis arrives a day after Brent crossed $100 per barrel, driven by Houthi attacks in the Red Sea and a sharp drop in crude transit through Hormuz. According to CNBC, Goldman estimates that crude flows from the Persian Gulf have fallen below 45% of pre-conflict levels between the United States and Iran, and warns that the oil market is "more vulnerable than in February" due to the recent decline in inventories. Middle East production has accumulated a reduction of between 7 and 8 million barrels per day (MMbd). If Iranian supply were completely interrupted, another 2.6 MMbd would be removed from the market.
The $120 scenario carries differentiated implications for Latin America. According to estimates from the Economic Commission for Latin America and the Caribbean (ECLAC) cited by Bloomberg Línea, South America's net exporting economies (Guyana, Trinidad and Tobago, Ecuador, Colombia, and Brazil) would see a modest improvement in their trade balance. By contrast, for the net-importing Caribbean the estimated deterioration is 1.3 points of GDP, and for Central America, Haiti, and the Dominican Republic it reaches 2.4 points. Mexico, despite being a crude exporter, has a "high dependence on imported refined fuels" that limits the net benefit of higher prices, according to ECLAC. The paradox (crude exporter but net importer of refined products) is a structural feature of Mexico's energy sector.
Goldman notes that its current estimate is lower than its February projection, as it incorporates greater demand elasticity in China, whose crude imports remain weak. The bank warns that the combination of low inventories and multiple bottlenecks keeps risks "skewed to the upside" as long as Hormuz transit remains disrupted.
This article was produced with artificial intelligence assistance from verified sources and reviewed by a human editor before publication.
Sources
Related stories
This article was drafted with AI assistance from verified sources and reviewed by a human editor before publication.