NEW YORK, March 5, 2026, 15:32 (EST)
Goldman Sachs on Thursday warned that if oil briefly spikes to $100 a barrel, global growth could slip by 0.4 percentage point. The call comes as tensions escalate in Iran and energy shipments from the Middle East face mounting pressure.
Goldman Sachs Group Inc (GS.N) is penciling in a 0.1-point hit to global GDP and a 0.2-point bump for headline inflation, which factors in fuel costs. The bank expects prices to cool, projecting crude at roughly $65 a barrel by Q4 2026.
Bank analysts say a $100 surge might tack on roughly 0.7 points to headline inflation—enough to make some central banks hesitate on rate cuts.
The warning arrives just as investors juggle adding a war premium to energy and holding on to hopes that inflation drops enough for policymakers to lower borrowing costs before year-end.
Oil tends to work like a tax. Households feel the pinch on fuel bills before it trickles down to companies, eventually touching sectors from shipping to food.
Goldman’s commodities team bumped up its Brent crude forecast for the second quarter of 2026, now seeing prices at $76 a barrel—a $10 increase. Its outlook for U.S. West Texas Intermediate (WTI) also climbed, raised by $9 to $71. The adjustments reflect expectations that reduced shipments through the Strait of Hormuz will eat into inventories and put a lid on Middle East output.
Brent could “likely reach $100” so long as Hormuz flows remain unchanged for five more weeks, according to the note. Reuters
UBS is calling for Brent to average $71 a barrel in the first quarter. J.P. Morgan’s warning: if the Strait of Hormuz stays closed, Iraq and Kuwait might halt supply within days—threatening up to 4.7 million barrels per day. Other banks, too, have been raising their risk estimates.
Oil climbed roughly 1% Wednesday, but momentum faded when U.S. President Donald Trump floated the idea of the Navy escorting ships through the strait, according to Reuters.
Goldman CEO David Solomon, speaking at a business summit in Sydney, said he was surprised by how “benign” markets have been so far. He added it may take “a couple of weeks” for investors to really process the war’s fallout.
He sees “strong macro tailwinds” pushing the U.S. economy, and puts the odds at a “reasonable probability” that it runs “a little bit hot” this year—potentially keeping inflation above what many are expecting.
Solomon flagged a worry: lending standards tend to get looser toward the end of a credit cycle, he said, as firms jostle to put their capital to work. “I’m a little concerned about that,” he added. Reuters
Moves in rate markets on Thursday followed a shift from Morgan Stanley, which now projects the European Central Bank will keep rates unchanged all the way through 2026. The bank cited persistent energy prices as a risk for euro zone inflation staying above target, scrapping its prior forecast for rate cuts.
The brokerage pointed out Brent climbed over 3% on the day, trading at $83.81 a barrel.
Goldman’s equity team has been flagging similar pressure mounting in stocks. Peter Oppenheimer, the firm’s chief global equities strategist, called out “correction risks” as elevated. He doesn’t expect an extended bear market, though—a bear market usually means a 20% slide from a record close, while a correction clocks in around 10%.
He noted the MSCI All Country World Index sat roughly 4% off its high, with the S&P 500 showing a 0.4% decline for the year.
Uncertainty around the pace at which artificial intelligence is reshaping business models is already making its way into underwriting decisions, Goldman’s Mahesh Saireddy told a New York conference on Wednesday.
“It’s not just software,” he said. Pricing risk? Over the coming “six, 12, 24 months”—that’s going to be “a challenging time,” he added. Reuters
Oil’s outlook is binary. Should tensions cool and tankers resume regular traffic, the risk premium could vanish quickly. But if the strait remains tight or infrastructure takes a hit, prices might spike, pushing demand to the breaking point.
Volatility’s a double-edged sword for Goldman and rivals. When markets swing, trading desks see a boost. But it can also chill dealmaking and put the brakes on fresh lending as clients hang back, waiting for a clearer read. Investors are tuning into shipping numbers, parsing central bank moves, and scanning for hints that the energy price surge is starting to bleed into broader inflation.
