Key facts
- Brent crude futures rose to $99.49 a barrel as of midnight GMT.
- US oil tankers were struck in retaliation for Iran's attacks on US warships.
- Saudi Arabian energy facilities were attacked by Iran-aligned Houthis.
- Average US gasoline prices reached a record $4.15 per gallon on Labor Day.
- Goldman Sachs predicts Brent crude could reach $85 by December.
- Bank of America suggests oil prices could reach $150 a barrel in an extreme scenario.
Oil prices have surged, with Brent crude futures approaching $100 a barrel amid escalating tensions and fresh strikes in the Middle East. This rise has contributed to record-high gasoline prices in the US, impacting consumer spending and potentially influencing the Federal Reserve's upcoming interest rate decisions.
The conflict has intensified following US strikes on Iranian oil tankers and Houthi attacks on Saudi Arabian energy facilities. These events have diminished hopes for a swift resolution to the six-month-old war between the US and Iran.
Analysts from Goldman Sachs and Bank of America have revised their oil price forecasts upwards. Goldman Sachs predicts Brent crude could reach $85 by December and potentially exceed $120 in an upside scenario for 2027, driven by potential shipping attacks. Bank of America sees oil prices reaching $120, with an extreme scenario of $150 if significant energy infrastructure in the Middle East is damaged.
Commodity experts also highlight a broader "energy crisis" stemming from limited refining capacity and declining global oil reserves, suggesting that inflationary pressures will be particularly evident in refined products like gasoline, diesel, and jet fuel.