Goldman Sachs Issues Cautious Outlook on Oil Prices Amid Recovery of Hormuz Flows
Goldman Sachs analysts Daan Struyven and Yulia Zhestkova Grigsby have issued a report highlighting the recovery in oil flows through the Strait of Hormuz, which has led to lower crude prices despite ongoing geopolitical tensions. The strait is critical for global oil trade, with about one-third of seaborne oil passing through it. After reaching a low of 5-6 million barrels per day during March due to conflict-related disruptions, flows have rebounded to around 15-16 million barrels daily as producers and shippers adapt using methods like dark crossings and ship-to-ship transfers. The firm notes that while crude oil prices are less likely to rise sharply in the near term, European natural gas and refined fuels face greater upside risk if disruptions persist. This is due to Europe's reliance on imported liquefied natural gas (LNG) and limited storage capacity, as well as logistical constraints for transporting refined products through alternative routes.
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