Goldman Sachs has raised its Brent and West Texas Intermediate (WTI) crude oil price forecasts by $5 a barrel for December 2026 and 2027, citing expectations that shipping disruptions in the Middle East will persist into next year, Reuters reported.

The bank said Brent crude could rise above $120 a barrel in 2027 if average oil production in the Gulf remains 4 million barrels per day below pre-war levels. That compares with Goldman Sachs’ base-case assumption of a 500,000-barrel-per-day shortfall.

However, the bank also outlined a significantly lower-price scenario. Brent could fall into the $60s a barrel in 2027 if average Gulf oil production rises by 1 million barrels per day above pre-war levels, according to the Reuters report.

Oil prices have recently climbed to a six-week high as renewed conflict in the Middle East heightened concerns over potential supply disruptions. Iran has also threatened the United States with economic retaliation, adding to fears that the conflict could escalate further.

The six-month-old war has been characterised by periods of calm followed by renewed flare-ups, keeping energy markets on edge. Shipping through the Strait of Hormuz has also slowed sharply, with an average of only 10 commodity ships passing through the key waterway each day over the past 10 days, the lowest level since May, shipping data showed on Monday.

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Goldman Sachs said the increase in its price forecasts remained relatively modest despite its assumption that shipping disruptions would continue. Reuters reported that the bank pointed to limited drawdowns in OECD commercial oil inventories since the conflict began and its expectation that Middle Eastern producers would continue adapting supply flows.The Strait of Hormuz is a critical route for global energy shipments, and prolonged disruption could tighten crude supplies and put upward pressure on prices. The extent of the impact, however, will depend heavily on the duration of the conflict, the pace at which Gulf production recovers and the ability of producers and traders to redirect supplies.

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Goldman Sachs’ scenarios highlight the wide range of possible outcomes for crude prices in 2027, with prolonged supply losses potentially pushing Brent above $120 a barrel, while a stronger-than-expected recovery in Gulf production could send prices down toward the $60s.