Crude oil prices in the international market are once again raising concerns for both ordinary citizens and large corporations. Early in the trading session on the morning of October 21, oil prices saw a decline, but later experienced a sudden surge. 37 dollars per barrel. 17 dollars per barrel. This surge in oil prices is driven by two major reasons. On one hand, reports of attacks in Gulf countries are emerging, and on the other hand, America's decision regarding the supply of Russian oil remains stalled. Meanwhile, Goldman Sachs Research states that crude oil prices could gradually decline over the next year as oil supply from the Middle East is expected to improve.
A major issue affecting oil prices is tied to Russia. US President Donald Trump issued an order on Friday night mentioning relief in certain sanctions and tariffs related to Russia. This included steps such as relief on taxes levied on Russian goods and penalties on countries purchasing Russian oil and gas. However, the very next day on Saturday, Trump clarified that a final decision on the matter has not been made yet. US Secretary of State Marco Rubio also stated that time is needed to understand the situation. The market now wants to understand what further impact this will have on the supply of Russian oil. If Russian oil becomes easily available, prices will get relief. Meanwhile, if the confusion persists, market volatility will continue.
Heightened tensions in the Middle East have also increased worries in the oil market. According to a report by Moneycontrol, Yemen's Houthi group claimed to have targeted Saudi Arabia's energy centers, airports, and military bases on Monday. These targets included an Aramco center in Yanbu, the Shaybah oilfield, and King Khalid International Airport in Riyadh. However, Saudi authorities didn't immediately confirm these claims, and independent verification wasn't possible. Meanwhile, an attack on a security forces training camp in Yemen's Shabwa province resulted in the death of 58 people, while over 200 people were injured. These incidents have heightened fears of oil supply disruptions in the region, driving up crude oil prices and pushing American WTI crude close to 100 dollars per barrel.
Amidst this crisis, Goldman Sachs Research recently released its future projections. According to the report, crude oil prices could gradually fall over the next year due to expected improvements in Middle East oil supplies. According to Daan Struyven, co-head of global commodity research and head of oil research at Goldman Sachs, Brent crude could remain around 90 dollars per barrel in December 2026. Previously, the bank had estimated it to be 85 dollars. Plus, the average price of Brent crude for the year 2027 is estimated to be 80 dollars per barrel. Improved supply could ease prices. However, if tensions between the US, Israel, or Iran escalate again, oil could remain expensive for a long time, putting pressure on global markets. In the coming months, the trajectory of oil prices will depend entirely on the normalization of the situation in the Middle East.