Goldman Sachs Says Refiners See 'High Probability' Of Sharp Oil Supply Drop As Houthi Attacks Escalate — Crude Oil Prices Hit 6-Month High

• According to Struyven, refiners are among those buying more crude because of the intensification of shipping attacks and strikes on infrastructure by the Houthis.
• Crude oil prices rose to a six-month high, with the U.S. West Texas Intermediate futures expiring in December rising 4.46% to $103.44 a barrel after a 7.81% gain the week before.
• Brent crude futures expiring in December rose 6.24% this week, hovering around $116.93 a barrel after a 4.91% increase the week before.

Crude oil prices have climbed to a six-month high as escalating attacks and rising tensions in the Middle East add to concerns about energy supply disruptions.

The latest escalation comes as fighting involving the Iran-aligned Houthis and a Saudi-led coalition has intensified, while shipping incidents have added to concerns around key waterways used to transport oil.

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Goldman Sachs' co-head of Global Commodities Research and head of Oil Research, Daan Struyven, said the recent rise in crude prices reflects growing downside risks to supply, with physical buyers and investors both contributing to the stronger market.

Crude Oil Prices Hit Six-Month High

Crude oil prices rose to a six-month high, with the U.S. West Texas Intermediate (WTI) futures expiring in December rising 4.46% to $103.44 a barrel after a 7.81% gain the week before. Brent crude futures expiring in December rose 6.24% this week, hovering around $116.93 a barrel after a 4.91% increase the week before.

The United States Oil Fund ETF (USO) rose more than 4% on Friday, while the ProShares Ultra Bloomberg Crude Oil ETF (UCO) gained about 4%.

Goldman Sachs Sees Growing Downside Risks To Oil Supply

Struyven said Brent crude had risen sharply as growing Middle East tensions and increasing downside risks to supply prompted buyers to bid up barrels in both physical and financial markets.

According to Struyven, refiners are among those buying more crude because of the intensification of shipping attacks and strikes on infrastructure by the Houthis. With inventories low, physical buyers are trying to secure barrels while they remain available.

Struyven said refiners see a "high probability of a sharp drop in supply," helping explain the precautionary buying taking place in the physical oil market.

He also pointed to financial-market demand, saying investors are buying oil as a hedge against higher energy prices because bonds and equities have become unusually sensitive to movements in crude.

Goldman Sachs sees the risks to oil prices as increasingly symmetrical following the recent surge, although Struyven said risks to the firm's forecasts remain skewed to the upside.

The bank's base case calls for Brent to end this year at $90 a barrel and average $80 a barrel in 2027. Struyven identified an intensification of shipping attacks, damage to oil infrastructure and a more persistent risk premium as key upside risks.

The analyst highlighted that crude oil exports from the Persian Gulf had reached about 110% of 2025 average levels over the previous couple of weeks, while refined-product exports such as diesel were running at only about 40% of the 2025 average.

He attributed part of the disparity to damage to refineries in the Middle East and the greater difficulty of arranging ship-to-ship transfers for refined products.

Goldman Sachs also sees factors beyond the Middle East supporting refined-product prices. Struyven pointed to structural tightness stemming from years of underinvestment, as well as reduced diesel production at Russian refineries following Ukrainian drone attacks.

Houthi Attacks Add To Middle East Supply Concerns

Tensions around key Middle East shipping routes have intensified in recent weeks, with attacks involving the Iran-aligned Houthis adding to concerns over the movement of oil and other energy products.

According to a Reuters report, Saudi Aramco ordered the evacuation of its headquarters in Dhahran on Thursday, as fighting intensified between Saudi Arabia and the Houthis. Dhahran is located near Bahrain and is home to the headquarters of the world's largest crude oil exporter.

Separately, an oil spill was detected off the coast of Umm Al Quwain in the United Arab Emirates, according to the UAE Ministry of Climate Change and Environment. The ministry did not say what caused the spill, and authorities had not identified the tanker involved.

During the after-hours session on Friday, the SPDR S&P 500 ETF (SPY), which tracks the S&P 500 index, rose 0.15%; the Invesco QQQ Trust ETF (QQQ) edged up by 0.07%; and the SPDR Dow Jones Industrial Average ETF Trust (DIA) gained 0.13%. Retail sentiment on Stocktwits toward the S&P 500 ETF was in the ‘extremely bearish’ territory at the time of writing.

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