A sharp rise in oil prices amid the conflict over Iran could slow global economic growth by approximately 0.3% over the next year, according to Goldman Sachs analysts, who also expect an acceleration in global inflation.

The bank estimates that rising energy prices could add approximately 0.5–0.6 percentage points to overall global inflation. However, core inflation, adjusted for volatile components, will increase more modestly—by approximately 0.1–0.2 percentage points. The updated estimates are due to disruptions in oil and gas supplies following the escalation of the conflict and problems with shipping through the Strait of Hormuz.

Goldman Sachs believes that the current shock is primarily focused on the energy market, rather than the entire global supply chain. This distinguishes the current situation from the pandemic, when numerous production and supply chains were simultaneously disrupted. The bank notes that most major economies rely little on non-energy exports from the Persian Gulf countries. Therefore, the risk of widespread disruptions to global trade is currently assessed as limited. However, in the event of further escalation or a prolonged blockage of the Strait of Hormuz, pressure on growth and inflation could increase.