Key Takeaways
- David Solomon, CEO of Goldman Sachs, projects oil prices between $80 and $100 per barrel over the coming three to six months
- An extreme escalation involving Iran could send crude soaring to $170 per barrel, Solomon cautioned
- Tuesday trading saw Brent crude decline 0.5% to $94.95 while WTI tumbled 1.8% to $88.04
- The Strait of Hormuz has been mostly blocked by Iran since hostilities erupted in late February
- Gulf producers Saudi Arabia and UAE have shifted export routes, pushing combined terminal volumes to 6.5 million barrels daily
David Solomon, who leads Goldman Sachs, projected Tuesday that crude oil could trade between $80 and $100 per barrel over the next three to six months. His remarks came during an appearance at the Paley Center.
Solomon went further, stating that a severe military confrontation with Iran could drive prices to $170 per barrel. While acknowledging that U.S. recession odds haven’t increased substantially, he emphasized the fragility of the current environment, noting it remains “only one tweet away” from dramatic shifts.
Oil prices retreated Tuesday as traders weighed conflicting developments surrounding U.S.-Iran diplomatic efforts. A provisional ceasefire arrangement is scheduled to lapse this week, though authorities haven’t disclosed the precise expiration time.
Brent crude futures slipped 0.5% to settle at $94.95 per barrel. U.S. West Texas Intermediate crude declined 1.8% to close at $88.04 per barrel.
The pullback followed a strong rally in the previous session, triggered by weekend developments that heightened geopolitical anxiety. Washington seized a vessel flying the Iranian flag, prompting Tehran to threaten countermeasures.
Iran subsequently closed the Strait of Hormuz once again, reversing a Friday reopening. Tehran justified the closure by pointing to continued U.S. naval blockades affecting Iranian maritime access.
Diplomatic Progress Remains Uncertain
President Trump declared Monday that the naval blockade would remain operational until a comprehensive peace settlement is finalized. He indicated that fresh negotiations with Tehran were anticipated this week, with an American delegation expected to travel to Pakistan on Tuesday or Wednesday.
However, Iranian leadership has publicly rejected additional negotiation rounds. Mohammad Bagher Ghalibaf, Iran’s Parliamentary Speaker and chief negotiator, stated that his country would not engage in talks “under the shadow of threats” emanating from the United States.
Multiple Iranian government media outlets reinforced this stance. Contradicting these public statements, though, separate intelligence suggests Iran has quietly informed regional intermediaries that it plans to dispatch representatives to Pakistan within days.
ANZ analysts wrote that “ongoing uncertainty continues to overshadow any peace agreement, as Iran remains reluctant to attend a second round of talks in Pakistan.”
Trump declared the two-week ceasefire on April 7 at 6:32 p.m. ET.
Strategic Waterway Remains Restricted
The Strait of Hormuz facilitates approximately 20% of global petroleum flows. Since fighting commenced in late February, the passageway has remained predominantly inaccessible.
Though the initial price shock has moderated slightly, benchmark crude values continue trading substantially above pre-conflict levels.
Saudi Arabia and the United Arab Emirates have restructured their export logistics to bypass Hormuz entirely. Both nations are channeling shipments through the Yanbu facility on the Red Sea and Fujairah in the Gulf of Oman.
According to ANZ research, aggregate throughput at these alternative 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 deadline looms with no confirmed peace framework established.
