Goldman Sachs said oil prices may rally to as much as $120 a barrel if attacks on shipping in the Middle East rise and it recommended bets on natural gas and diesel as a way to capture gains, Bloomberg News reported on Sunday.
“Events over the last few days do suggest that the risk of shipping disruptions broadening and intensifying is an important one," Daan Struyven, co-head of global commodities research, said in an interview on Bloomberg TV.
In addition, the bank said oil could fall to $80 a barrel if exports from the region return to normal levels, Bloomberg reported, citing Struyven.
Oil prices extended gains as tit-for-tat strikes between the U.S. and Iran on vessels sailing in the Strait of Hormuz and other areas heightened concerns of a prolonged supply disruption from the Middle East.