What Goldman Sachs’ $100 Brent projection means for households, firms

GOLDMAN Sachs has forecast that Brent Crude will average over $100 per barrel this month due to the ongoing conflict in the Middle East, which continues to restrict supply. The investment bank noted that prices could climb even further if the disruption at the Strait of Hormuz lasts months rather than weeks.

Looking ahead, the investment bank expects Brent to average $85 per barrel in April. It also raised its fourth quarter (Q4) outlook, projecting Brent at $71 per barrel and WTI at $67, up from previous forecasts of $66 and $62, respectively.

Goldman Sachs warned that these figures may be conservative, noting that a prolonged blockade could push Brent’s average to $93 in Q4, with short-term spikes well above $100. In Asian trading on Friday, Brent rose 2 percent above $102 per barrel, while WTI exceeded $97.

Implications of sustained $100 per barrel

Experts say it could drive fuel prices globally, increasing transportation, electricity, and goods costs, which would drive inflation higher. Also, companies with high energy consumption, such as airlines, logistics, and manufacturing, may face rising operating costs, potentially reducing profit margins.

READ ALSO: Goldman Sachs lifts oil price outlook as Middle East tensions intensify

Similarly, energy and commodities investors could benefit from higher oil prices, while renewable energy sectors may gain renewed attention as alternatives become more cost-competitive.

Countries that heavily import oil may face larger budget deficits and pressure on foreign reserves, while oil-exporting nations could see a temporary boost in revenue.

Despite interventions like the International Energy Association (IEA)’s release of 400 million barrels and the U.S. waiver allowing Russian oil sales from floating storage, analysts caution that it will take weeks for additional supply to reach the market. Meanwhile, ongoing conflict around Oman and UAE oil ports keeps tanker operations risky, sustaining high price volatility.

“As a Nigerian, our revenue will increase when the oil prices rise in the global market,” said a Lagos-based energy entrepreneur, Mr Sam Odika. “But the petrol price will also jump, which will fuel inflation and worsen the cost of living.”

READ ALSO: Oil prices surge 21% in one week amid Strait of Hormuz supply disruption

Nigerians have faced the cost-of-living crisis in the last 3 years, after President Bola Tinubu announced an end to the petrol subsidy regime and the foreign exchange market. Consequently, petrol price has hovered from N860/litre to N900/litre across the nation before the Middle East crisis. With the U.S.-Israel-Iran war escalating, petrol proce could rise further, worsening Nigerians’ cost of living.

“With President Tinubu failing to provide a comprehensive support system for the poor, sustained petrol price increases could further hurt the poor and shrink economic growth,” said an Abuja-based economist, Dr Esther Essien, who lecturers in a Nigerian federal university.