The impact of the Middle East conflict on energy markets is spreading from oil prices themselves to shipping costs. A new report from Goldman Sachs says average global seaborne crude shipping costs have soared from $3 a barrel (about NT$97) a year ago to more than $20 (about NT$650), an increase of nearly sevenfold, and freight rates are unlikely to fall significantly until the Middle East conflict eases.
The team led by analyst Yulia Zhestkova Grigsby broke down the sources of the surge in the report: the war-risk premium for transiting the Strait of Hormuz alone contributes about $7 a barrel (about NT$230); rising fuel costs and ship-to-ship transfer operations each add roughly another $4 (about NT$130). In other words, war risk and transfer demand alone account for more than half of the year's increase in shipping costs. Looking at Middle East routes alone, freight levels have already exceeded $35 a barrel (about NT$1,100).
Goldman Sachs' base case still projects Brent Crude prices to fall back to $90 a barrel (about NT$2,900) by the end of 2026, with a 2027 average of $80 (about NT$2,600). But the report explicitly flags upside risks to this forecast, citing prolonged high freight rates, rising frequency of attacks on vessels, damage to oil infrastructure, and a geopolitical risk premium that has yet to dissipate.
The report comes as Middle East tensions flare again. Iran's Revolutionary Guard said two tankers that did not follow Tehran-designated shipping lanes struck naval mines laid in the southern Strait of Hormuz at an "illegal crossing point," catching fire and halting navigation. Meanwhile, Yemen's Houthi Movement claimed responsibility for attacks on Saudi Aramco facilities in Yanbu, the Shaybah oil field, and the airports in Riyadh and Abha.
Caught between supply-side concerns and geopolitical risk, international oil prices rose on Wednesday. Front-month Brent Crude futures gained 1.22% to $110.13 a barrel (about NT$3,600); West Texas Intermediate (WTI) rose 1.11% to $98.92 a barrel (about NT$3,200). Brent had surged to a five-month high the previous day before paring gains after Iranian officials met with mediators in Pakistan, but Tehran told Pakistan's army chief it would not negotiate with Washington until its demands were met, dashing market hopes for diplomatic progress.
U.S. crude inventories also signaled tightening. American Petroleum Institute (API) data showed U.S. crude stockpiles fell by 4.93 million barrels in the week to October 16, far exceeding market expectations of 1.3 million barrels, marking a second straight week of larger-than-expected drawdowns, with hurricane-hit production along the Gulf Coast a major factor. At the same time, the U.S. Strategic Petroleum Reserve (SPR) has fallen to its lowest level in 44 years.
Goldman Sachs analysts believe the impact of high freight rates will not be confined to shipowners and traders. With the effective landed price of crude pushed higher, refiners' overall crude demand could be dampened; refiners may also turn to nearby suppliers, further reshaping existing trade routes and the structure of crude grade spreads. The report specifically notes that high freight rates are hitting Asian refiners' net margins especially hard, and if refiners cut output, refined product prices will be pushed even higher.
Notably, nearly one in six tankers currently sailing in the Persian Gulf and Gulf of Oman is engaged in ship-to-ship transfer operations. This model of loading onto smaller vessels outside disputed waters and then transferring to larger tankers has become a key link in sustaining Gulf crude exports. Analysts note that even if Gulf crude exports recover, which should in theory drive oil prices lower, as long as the incremental exports remain highly dependent on ship-to-ship transfers, freight rates could instead keep rising due to concentrated demand.
In other words, as long as the Middle East conflict remains at its current level, the factors supporting elevated and volatile crude shipping costs will persist. For investors, this means the lens for watching energy markets cannot be limited to futures prices; shipping costs, refining margins and end-user refined product prices must be viewed together. The scenario painted by the Goldman Sachs report is precisely one transmission path through which oil price forecasts face upward revision pressure.