Key Points
- David Solomon, Goldman Sachs CEO, projects crude oil will reach $80–$100 per barrel over the next three to six months
- A major escalation involving Iran could propel prices to $170 per barrel, Solomon cautioned
- Tuesday trading saw Brent crude decline 0.5% to $94.95 while WTI fell 1.8% to $88.04
- The Strait of Hormuz has remained mostly closed since hostilities erupted in late February
- Gulf producers Saudi Arabia and UAE now ship 6.5 million barrels daily through alternative routes
David Solomon, chief executive of Goldman Sachs, projected Tuesday that crude prices are headed toward $80 to $100 per barrel over the coming three to six months. He delivered these remarks during an appearance at the Paley Center.
Solomon further cautioned that a significant escalation in hostilities involving Iran could send oil soaring to $170 per barrel. He noted that while U.S. recession risk remains relatively modest at present, the geopolitical landscape is volatile enough that conditions could shift dramatically with little warning.
Oil prices retreated Tuesday amid uncertainty surrounding diplomatic negotiations between Washington and Tehran. A temporary halt in hostilities is scheduled to lapse within days, though officials have not disclosed the precise deadline.
Brent crude futures slipped 0.5% to settle at $94.95 per barrel. U.S. West Texas Intermediate declined 1.8% to close at $88.04 per barrel.
The previous session had witnessed significant gains after weekend developments heightened tensions. Washington confiscated a cargo vessel sailing under the Iranian flag, prompting Tehran to issue warnings of potential countermeasures.
Tehran subsequently re-closed the Strait of Hormuz after briefly reopening it Friday. Iranian authorities justified the action by pointing to continued U.S. naval restrictions targeting Iranian harbors and territorial waters.
Diplomatic Progress Remains Uncertain
President Trump stated Monday that naval operations restricting Iranian maritime activity would continue until a comprehensive agreement is finalized. He indicated that additional negotiations with Tehran were anticipated this week, with American representatives scheduled to travel to Pakistan on Tuesday or Wednesday.
However, Iranian leadership has publicly rejected further dialogue. Mohammad Bagher Ghalibaf, Iran’s Parliamentary Speaker and chief negotiator, declared that Tehran would not engage in discussions “under the shadow of threats” emanating from the United States.
Multiple Iranian state-controlled media outlets reinforced this stance. Conversely, independent reporting suggested that Tehran privately communicated to regional intermediaries its willingness to dispatch a delegation to Pakistan this week.
Analysts at ANZ noted that “ongoing uncertainty continues to overshadow any peace agreement, as Iran remains reluctant to attend a second round of talks in Pakistan.”
The President announced the two-week cessation of hostilities on April 7 at 6:32 p.m. Eastern Time.
Strait Blockade Persists
The Strait of Hormuz facilitates transit for approximately twenty percent of global oil exports. The strategic waterway has been predominantly blocked since conflict commenced in late February.
Though the initial surge in crude prices has moderated somewhat, market values remain substantially elevated compared to pre-conflict benchmarks.
Major Gulf exporters Saudi Arabia and the United Arab Emirates have redirected shipping operations away from the Hormuz chokepoint. Alternative loading facilities include the Yanbu terminal on the Red Sea coast and the Fujairah terminal positioned along the Gulf of Oman.
According to ANZ research, throughput at these two substitute terminals has climbed to 6.5 million barrels daily, representing an increase from the pre-war baseline of 5.0 million barrels per day.
The Iranian ceasefire expiration approaches with no verified peace framework established.
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