Goldman Sachs: oil price could rise to $120 per barrel with escalation in the Middle East

Oil prices could rise to $120 per barrel if attacks on tankers in the Middle East continue. Analysts at Goldman Sachs called this condition, Bloomberg reports.

The cost of raw materials has already risen to its highest since July (at its peak, prices reached $97.94) as the US and Iran failed to reach an agreement on the operation of the Strait of Hormuz. In recent days, Washington has attacked Iranian tankers and Tehran has declared a new restricted shipping zone outside the strait.

“Events in recent days do indicate that there is a serious risk of wider and worsening shipping disruptions,” said Daan Struyven, co-head of global commodities research at Goldman Sachs.

Goldman also has a lower forecast: if exports from the region normalize, oil prices could fall to $80 per barrel. China will continue to act as a “stabilizing force” in the oil market, reducing imports in response to rising prices, Struyven said.