Goldman Sachs Bullish on Oil Amid Mideast Tensions
Goldman Sachs raised its Q4 2026 Brent and WTI forecasts to $71/$67 per barrel due to prolonged Strait of Hormuz disruptions. The risk of a "third great oil shock" is real, potentially impacting global growth and infrastructure operating costs, especially for energy-intensive data centers.
The Strait of Hormuz, a critical chokepoint for global energy trade, has been disrupted since late February 2026 due to increased conflict involving Iran. Approximately 20% of the world's oil, or about 20 million barrels per day, normally passes through this waterway, linking Persian Gulf producers to international markets. The disruption has led to a near halt in tanker movements, forcing Gulf countries to cut oil production by at least 10 million barrels per day. Goldman Sachs now assumes 21 days of significantly reduced oil flows (10% of normal) followed by a 30-day recovery. Under a scenario of a month-long disruption, Brent crude could average $76 per barrel, and WTI at $72. A 60-day disruption could send Brent to $93 and WTI to $89. Some analysts warn that if the Strait remains closed for 4-8 weeks, oil could spike to $150 per barrel. The rise in crude prices has a direct impact on data centers, where energy costs can account for up to 60% of operating expenses. AI data centers, which consume 3-5 times more electricity than conventional ones, are particularly vulnerable. Companies are exploring solutions like small modular nuclear reactors to provide more stable and clean energy for these facilities.
