Goldman Sachs warns oil prices could soar by $20 amid Iranian production concerns: Report

Oil prices could surge by $20 per barrel if Iranian production is disrupted, according to Goldman Sachs, as reported by CNBC. On October 3, US crude futures rose about 5% and continued to climb on October 4 amid concerns that Israel might target Iran’s oil industry following a missile attack from Tehran.

Goldman Sachs’ co-head of global commodities research, Daan Struyven, told CNBC that a sustained drop of 1 million barrels per day in Iranian output could push oil prices up by around $20 per barrel next year. This estimate assumes that the oil cartel OPEC+ does not respond by increasing production. If major OPEC+ members like Saudi Arabia and the UAE compensate for the production loss, the price increase might be less than $10 per barrel.

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Since the onset of the Israel-Hamas conflict on October 7 of last year, the oil market has experienced limited disruptions, largely due to increased US production and sluggish demand from China. However, recent events have shifted market sentiment. Following Iran's ballistic missile attack on Israel, US crude prices have seen three consecutive days of gains, with analysts warning of a potential threat to oil supply, the CNBC report added.