{"id":1371,"date":"2026-03-03T17:28:58","date_gmt":"2026-03-03T17:28:58","guid":{"rendered":"https:\/\/owspakistan.com\/?p=1371"},"modified":"2026-03-05T01:23:29","modified_gmt":"2026-03-05T01:23:29","slug":"how-long-will-iran-war-last-stock-market-oil-barrel-price-goldman-sachs","status":"publish","type":"post","link":"https:\/\/owspakistan.com\/?p=1371","title":{"rendered":"The stock market thinks the Iran war will last 4 weeks, according to Goldman’s head of oil research"},"content":{"rendered":"

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In the wake of a major U.S. and Israeli military campaign against Iran that resulted in the death of Supreme Leader Ayatollah Ali Khamenei, global oil markets experienced an immediate jolt. Brent crude oil prices surged 8% over the weekend<\/a> to approximately $78 a barrel, reflecting acute anxiety over Middle Eastern energy supplies. However, according to Goldman Sachs\u2019 Head of Oil Research, Daan Struyven<\/a>, this specific price point reveals exactly what traders are betting on: a disruption lasting about four weeks.<\/p>\n

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Speaking on the Goldman Sachs Exchanges<\/a><\/em> podcast on March 2, Struyven broke down the math behind the market\u2019s reaction. Without sustained supply disruptions, Goldman Sachs estimates the fair value for Brent crude oil to be around $65 per barrel. \u201cWith the market price at $78, the market is essentially pricing an $13 per barrel risk premium,\u201d Struyven explained. According to the firm\u2019s models, this $13 premium perfectly aligns with the expected price impact of a 100% full closure of the Strait of Hormuz lasting for roughly one month.<\/p>\n

Currently, the Strait of Hormuz\u2014a vital chokepoint that normally handles about one-fifth of the world\u2019s global oil supply\u2014is not completely shut down. Instead, Struyven explained that the sharp drop in export flows is being driven by fear. Shippers and oil producers have entered a \u201cwait-and-see mode\u201d following reports of damage to three ships and skyrocketing insurance premiums.<\/p>\n

The four-week timeline priced in by the market represents a critical threshold for the global economy. Struyven noted that the impact on oil prices is a \u201cconvex function\u201d of the disruption\u2019s length. If the conflict is brief\u2014lasting only a few days or a week\u2014the impact on prices will be disproportionately smaller. In a short-term scenario, crude oil can simply be stored on land in Middle Eastern producing countries, delaying deliveries but leaving the cumulative global supply unaffected\u2014a workaround if Iran\u2019s threats of shutting down the Strait stretch come to fruition.<\/p>\n

However, if the war and the effective closure of the Strait stretch beyond the market\u2019s four-week expectation, the economic consequences could become dire. If regional storage facilities run out of space and production is forced to shut down, the market will only be able to rebalance through forced \u201cdemand destruction\u201d. \u201cTo generate substantial demand destruction, prices may have to rise into triple digit territory,\u201d Struyven warned, adding that the length of the disruption is the single most important variable in the market right now. Every sustained 10% increase in crude oil prices raises headline inflation by about 0.3% and reduces disposable income by the same margin.<\/p>\n

Struyven\u2019s calculations come as economists are surveying the damage that President Donald Trump\u2019s Operation Epic Fury is doing to the U.S. economy. Penn Wharton Budget Model Director Kent Smetters previously told Fortune<\/em><\/a> that he estimates a wide range of outcomes, including damage to the U.S. economy as high as $210 billion. Smetters offered one note of caution about how war costs are typically framed. \u201cOne problem I have with cost-of-war calculations is that they really do ignore the counterfactual,\u201d he added. \u201cIf Iran really did get a nuclear weapon, then we might have spent a lot more on military and even repair of cities later on.\u201d<\/p>\n

Compounding the danger of a prolonged conflict is the reality of \u201ctrapped\u201d spare capacity. While the global market normally relies on spare capacity in Saudi Arabia, the UAE, and Kuwait to buffer against price shocks, Struyven explained that those barrels typically must flow through the Strait of Hormuz to reach global buyers. Consequently, as long as the Strait remains compromised, that spare capacity cannot be physically deployed. Furthermore, while the U.S. Strategic Petroleum Reserve (SPR) could be used as a textbook response to sustained disruptions, the SPR currently holds around 415 million barrels\u2014more than 200 million barrels lower than it was prior to the 2022 energy crisis.<\/p>\n

Ultimately, whether the market\u2019s four-week bet proves accurate will depend on geopolitical developments in the coming days. Struyven is closely watching for signals regarding the conflict\u2019s length, noting that sweeping goals like \u201cregime change\u201d from the U.S. administration could indicate a protracted war, while narrower military goals or the rise of a reformist leader in Iran could offer an off-ramp for a shorter conflict. For now, Wall Street is pricing in a month of turmoil, hoping the physical flow of oil resumes before prices are forced into the triple digits.<\/p>\n

For this story,\u00a0<\/em>Fortune\u00a0journalists used generative AI as a research tool. An editor verified the accuracy of the information before publishing.<\/em><\/p>\n<\/div>\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

In the wake of a major U.S. and Israeli military campaign against Iran that resulted in the death of Supreme Leader Ayatollah Ali Khamenei, global oil markets experienced an immediate jolt. Brent crude oil prices surged 8% over the weekend to approximately $78 a barrel, reflecting acute anxiety over Middle Eastern energy supplies. However, according<\/p>\n","protected":false},"author":1,"featured_media":1372,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[204,203],"tags":[199,200,201,202],"class_list":["post-1371","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-finance","category-energy","tag-goldman-sachs-group","tag-iran","tag-middle-east","tag-oil-and-gas"],"jetpack_publicize_connections":[],"_links":{"self":[{"href":"https:\/\/owspakistan.com\/index.php?rest_route=\/wp\/v2\/posts\/1371","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/owspakistan.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/owspakistan.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/owspakistan.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/owspakistan.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=1371"}],"version-history":[{"count":0,"href":"https:\/\/owspakistan.com\/index.php?rest_route=\/wp\/v2\/posts\/1371\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/owspakistan.com\/index.php?rest_route=\/wp\/v2\/media\/1372"}],"wp:attachment":[{"href":"https:\/\/owspakistan.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=1371"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/owspakistan.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=1371"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/owspakistan.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=1371"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}