This article first appeared on GuruFocus.

Goldman Sachs sees a wide oil-price range as escalating attacks on Middle East shipping threaten global energy supplies.

The bank says oil could surge to $120 a barrel if shipping disruptions broaden and intensify. From Brent's $97.50 level, that implies roughly 23% upside. Goldman also sees oil falling to $80 if regional exports normalize, representing 18% downside.

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Daan Struyven, Goldman's co-head of global commodities research, said recent events suggest the risk of shipping disruptions broadening and intensifying is an important one. The concern follows tit-for-tat strikes between the United States and Iran against vessels around the Strait of Hormuz and elsewhere, raising the prospect of prolonged interruptions.

Brent gained 1.3% to $97.50, while West Texas Intermediate rose 1.3% to $92.28. Those moves show a risk premium entering crude, although prices remain below Goldman's severe-disruption scenario.

Hormuz is an outlet for Persian Gulf oil. Even without complete closure, attacks can raise insurance costs, delay deliveries and force traders to demand premiums for immediate barrels.

Goldman recommends natural gas and diesel trades to capture gains rather than relying only on crude. That suggests disruption could affect energy markets unevenly, with refined products or gas potentially offering exposure.

For investors, the $120 call is not a standalone price target. It is a conditional stress scenario. The decisive variables are attack frequency, vessel traffic, insurance availability, export volumes and further U.S.-Iran escalation.

Energy producers could benefit from sustained high prices, while airlines, transportation companies and consumers face rising costs. Broader inflation could also pressure bond yields and complicate central-bank policy.

The crucial point is asymmetry. Normalized exports could pull oil toward $80, but worsening disruption could trigger a rapid spike toward $120. Investors must decide whether current prices adequately compensate them for a tail risk centered on shipping security rather than conventional supply-and-demand fundamentals.