Brent crude briefly topped $99 a barrel and WTI rose above $93 on Tuesday after the U.S. and Iran exchanged fresh strikes, including attacks on oil tankers in the Strait of Hormuz and reported explosions on Kharg Island. Goldman Sachs raised its Brent and WTI forecasts, citing supply disruptions it expects to persist into 2027.
Brent crude futures expiring in November climbed 1.5% to $98.42 a barrel on Tuesday, briefly breaking above $99. U.S. West Texas Intermediate futures expiring in October added 2.2% to $93.44 a barrel. Both contracts had already surged 9.3% and 9.7% last week as Washington and Tehran returned to kinetic action for the first time since July.
Strikes hit tankers near the Strait of Hormuz
U.S. Central Command struck three Iranian crude oil carriers on Saturday, retaliating for what it said were Islamic Revolutionary Guard Corps missile attacks on two U.S. Navy warships patrolling regional waters. Iran's state media said Tehran responded by targeting six ships in the Strait of Hormuz and the Persian Gulf on Sunday, including three tankers and three vessels belonging to the U.S.
According to Iranian official Mohsen Rezaee: "received a clear warning from Iran's new missiles." Iran's Supreme National Security Council secretary separately threatened a maritime exclusion zone across the Persian Gulf. On Tuesday, Iran's state media claimed its armed forces had captured a U.S. autonomous submarine at the entrance to the Strait of Hormuz, and more explosions were reported on Kharg Island.
Supply concerns mount amid the geopolitical risk
Crude oil exports out of the Middle East in August were down 39% from the 18.5 million barrel-per-day baseline seen in January and February before the conflict began, according to TankerTrackers.com. Reports of fresh drone and missile strikes targeting Saudi Aramco's 400,000-barrel-per-day Jazan refinery near the Red Sea added to concerns over global refined product supply. At the pump, the national average price of diesel touched $5.90 a gallon for the first time on Tuesday, according to GasBuddy.
Goldman raises its price forecasts
Goldman Sachs raised its Brent and WTI forecasts by $5 on Sunday, to $85 and $80 for December 2026 and $80 and $75 for 2027, saying it expects Middle East shipping disruptions to persist into 2027. The bank called the upgrade modest, however, pointing out that OECD commercial land inventories have barely drawn down since the war began. It also expects Middle East supply to keep adapting, with production gradually recovering in the second half of 2027 as new pipelines come online. U.S. crude inventories in the Strategic Petroleum Reserve fell by 1.2 million barrels in the week of September 4 to 285.4 million barrels, the lowest level since November 1982.
Source: Investing.com
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