Goldman Sachs released a report indicating that there are both upside and downside risks to the expected prices of Brent crude and WTI crude for 2026. Goldman anticipates an average price of $83 per barrel for Brent crude and $78 per barrel for WTI crude in 2026. However, these expectations could be significantly affected by developments in the Middle East and potential risks to oil transportation through the Strait of Hormuz.
Upside Risk: Blockage of Oil Transportation through the Strait of Hormuz
Goldman Sachs notes that a reduction in oil flow through the Strait of Hormuz poses the greatest upside risk to oil price forecasts. Currently, oil flow through the Strait of Hormuz remains at about 10% of normal levels, or approximately 2.1 million barrels per day. The U.S. Navy has begun blocking ships entering and exiting Iranian ports and coastal areas, which further adds to the upside risk on oil prices.
Particularly, tankers related to Iran account for the majority of recent crude oil transportation through the Strait of Hormuz. If the U.S. blockade of this crucial waterway continues, it could lead to a tightening of global oil supply, thereby pushing up oil prices.
Downside Risk: Middle East Production Cuts Lower than Expected, Slowing Global Inventory Decline
At the same time, Goldman also points out that production cuts in the Middle East are lower than expected, posing pressure on the downside risks to oil prices. Goldman projects that the average amount of crude oil production halted in the Persian Gulf region is 8 million barrels per day, lower than the International Energy Agency's (IEA) estimate of 10 million barrels per day. This implies that even as production cuts continue, the supply pressure on the oil market may not be as significant as anticipated.
In addition, the announcement of a ceasefire between the U.S. and Iran and the rising possibility of a recent peace agreement have reduced geopolitical risk premiums, exerting further downward pressure on oil prices. Goldman states that the decline in global apparent crude oil inventories has slowed significantly, with the past week's inventory reduction dropping from about 7 million barrels per day during the month so far to around 2 million barrels per day.
Market Reaction: Oil Price Volatility
As of April 15, 2026, at 0701 GMT, Brent crude futures (BRN1!) remained stable at $94.75 per barrel, while U.S. West Texas Intermediate crude futures (CL1!) fell by 0.3% to $90.98 per barrel. The market's reaction to Goldman's forecasts and developments in the Middle East evidently displays some oil price volatility.
Future Outlook: Middle East Situation and Global Inventory Changes Will Continue to Influence Oil Prices
As the Middle East situation continues to evolve and global oil demand changes, oil prices may be driven by multiple factors. Goldman Sachs states that future oil price movements will depend on the strength of the U.S. blockade of the Strait of Hormuz, progress in global production cut agreements, and the potential conclusion of peace agreements in the Middle East. Oil prices are likely to remain volatile in the short term and be influenced by changes in global inventories.
