Oil prices threaten $100 mark as Middle East tensions escalate
BY MOTOLANI OSENI
Oil market analysts are warning of a potential surge in global crude prices, possibly breaching $100 per barrel, as escalating military tensions between Israel and Iran fuel fresh supply concerns.
Following Israel’s recent wide-ranging strikes on Iranian nuclear facilities and missile factories, global oil prices jumped nearly 9 per cent, with Brent crude futures trading around $74.74 per barrel. Though no major supply disruptions have yet occurred, the heightened conflict has introduced significant volatility into global energy markets.
Goldman Sachs, in its latest assessment, acknowledged the increased geopolitical risk premium in its summer 2025 forecast but maintained its base case that oil supply from the Middle East will remain uninterrupted. “We still assume no disruptions to oil supply in the Middle East,” Goldman Sachs noted in a client report, adding that strong non-U.S. shale output is expected to pull Brent and WTI prices down to $59 and $55 per barrel, respectively, by fourth quarter 2025, and even lower into 2026.
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However, the bank also cautioned that any blockade of the Strait of Hormuz, through which nearly 20 per cent of the world’s oil supply flows, could trigger an extreme scenario where prices surge beyond $100 a barrel. JP Morgan echoed this concern, suggesting that a full-scale regional conflict could propel prices into the $120 to $130 range.
Citi analysts similarly predicted limited immediate supply disruptions, though they warned that elevated geopolitical tensions could sustain short-term price volatility. Commerzbank added that while prices are unlikely to collapse below $70 for now, any further escalation could alter the market outlook dramatically.
The Organisation of the Petroleum Exporting Countries (OPEC) remains cautious but steady in its response. OPEC Secretary-General Haitham Al Ghais stated that current market fundamentals do not warrant any immediate supply adjustments, even as geopolitical risks intensify.
For now, markets are closely monitoring developments in the Middle East, with traders and policymakers alike weighing the impact of any further escalation on global energy security. The Strait of Hormuz remains a critical flashpoint, its vulnerability underscoring the market’s sensitivity to geopolitical shocks that could redefine oil’s price trajectory in the coming months.
