Goldman Sachs Raises Oil Price Forecasts Amid Hormuz Tensions and Inventory Draws

If you filled up your tank in Austin this past weekend, you probably winced at the sticker shock. That pain at the pump isn’t just a fleeting inconvenience—it’s the local ripple of a global oil shock that’s now expected to last longer and hit harder than anyone predicted just a few weeks ago. Goldman Sachs just revised its oil-price forecasts upward for the third time in two months, warning that the closure of the Strait of Hormuz is draining global inventories at a pace not seen in decades. For Central Texas families, small businesses and city planners, this isn’t just a headline from halfway across the world. It’s a novel economic reality that’s about to reshape everything from your commute to your grocery bill—and it’s arriving just as the summer driving season kicks into high gear.

Here’s what you need to understand: Goldman now expects Brent crude to average $90 a barrel in the fourth quarter of 2026, up from its previous forecast of $80. That’s a nearly $30 jump from pre-crisis levels, and the bank’s analysts aren’t mincing words about the scale of the disruption. The Strait of Hormuz, the 21-mile-wide chokepoint through which roughly one-fifth of the world’s oil flows, has been effectively shut down since late February due to the escalating conflict in Iran. The result? A staggering 14.5 million barrels of daily crude production from the Persian Gulf are now offline, forcing global oil inventories to draw down at a record pace of 11 to 12 million barrels per day in April alone. To put that in perspective, that’s roughly equivalent to the entire daily output of Saudi Arabia vanishing from the market overnight—and it’s happening at a time when demand is typically ramping up for the summer.

For Austin, a city where the average commute is 26 minutes (and growing) and where the tech boom has brought in thousands of new residents who rely on cars to acquire to operate, the timing couldn’t be worse. The city’s transportation planners have already been grappling with the challenges of rapid growth, from I-35 congestion to the ongoing expansion of the MetroRail system. Now, they’re facing a new variable: a sustained spike in fuel costs that could reshape commuting patterns, delivery logistics, and even the viability of some small businesses. The Austin Chamber of Commerce has already begun fielding calls from local restaurant owners and retail shops worried about passing on higher fuel surcharges to customers who are already stretched thin by rising rents and inflation.

But the impact goes beyond the pump. The “Hormuz shock,” as Goldman’s analysts are calling it, is reverberating through the entire supply chain. Accept the Port of Houston, for example—one of the busiest ports in the country and a critical hub for everything from petrochemicals to consumer goods bound for Central Texas. The port has seen a noticeable slowdown in shipments of refined products like diesel and jet fuel, which are now being diverted to higher-priority markets on the East Coast. For Austin’s construction industry, which relies heavily on diesel-powered equipment, this could mean delays and cost overruns on projects ranging from the new Apple campus in Northwest Austin to the affordable housing developments along the Eastern Crescent. The Austin Board of Realtors has already noted that some builders are starting to include fuel-cost escalation clauses in their contracts, a practice that was rare even during the supply chain disruptions of the early 2020s.

Then there’s the inflation angle. Austin’s Consumer Price Index has been rising faster than the national average for the past year, driven in part by housing costs and service-sector wages. Now, with oil prices surging, local economists are bracing for a second wave of inflationary pressure. The Federal Reserve Bank of Dallas, which has a regional office in Austin, has been monitoring the situation closely. In a recent briefing, economists there warned that if the Strait of Hormuz remains closed through the summer, the resulting spike in fuel and transportation costs could shave as much as 0.5 percentage points off the region’s GDP growth in the second half of the year. That might not sound like much, but in a city where the economy is already cooling from its pandemic-era highs, it’s enough to tip some marginal businesses into the red—and to force local policymakers to make tough choices about where to allocate scarce resources.

Goldman’s analysts aren’t just sounding the alarm about the immediate supply shock. They’re also warning about the longer-term risks of a “demand destruction” scenario, where persistently high oil prices force consumers and businesses to cut back on spending in other areas. For Austin, a city that prides itself on its vibrant cultural scene and thriving small-business ecosystem, that could mean fewer discretionary dollars flowing to local restaurants, live music venues, and retail shops. The Austin Independent Business Alliance has already reported that some members are seeing a slowdown in foot traffic, particularly in areas like South Congress and the Domain, where shoppers are more likely to drive in from the suburbs. And with the city’s tourism industry still recovering from the pandemic, the timing of this shock couldn’t be worse. The Austin Convention & Visitors Bureau is already bracing for a potential drop in summer travel, particularly from out-of-state visitors who might consider twice about flying into Austin-Bergstrom International Airport if airfares remain elevated.

So what does this mean for you, the Austin resident? It means that the choices you make in the coming months—how you commute, where you shop, how you heat and cool your home—will have a bigger impact than ever on your bottom line. It also means that local leaders, from the Austin City Council to the Travis County Commissioners Court, are facing a new set of challenges as they try to balance the need for economic growth with the realities of a constrained energy market. The city’s Climate Equity Plan, which aims to reduce greenhouse gas emissions by 50% by 2030, is suddenly colliding with the immediate need to keep the lights on and the economy moving. And with the Texas Legislature’s recent moves to restrict local governments’ ability to regulate energy use, the tools available to city officials are more limited than ever.

But amid the challenges, We find also opportunities. Austin has long been a leader in renewable energy and sustainability, from the sprawling solar farms in West Texas to the city’s ambitious goal of powering all municipal operations with renewable energy by 2025. The current crisis could accelerate that transition, as businesses and residents alike look for ways to reduce their dependence on volatile fossil fuel markets. The Austin Energy Resource, Generation and Climate Protection Plan, which is up for review later this year, could take on new urgency as the city grapples with the fallout from the Hormuz shock. And for local entrepreneurs, the disruption could create openings for innovative solutions—whether it’s electric vehicle charging infrastructure, last-mile delivery services powered by e-bikes, or new models for local food production that reduce reliance on long-distance shipping.

The Local Ripple Effect: What Austin’s Key Sectors Are Facing

To understand how deeply this oil shock could reshape Austin, it’s worth looking at how it’s already playing out in three critical sectors of the local economy: transportation, small business, and real estate.

1. Transportation: The Commute Crunch

Austin’s transportation network is already under strain, and the Hormuz shock is about to make things worse. The city’s public transit system, Capital Metro, has been expanding its bus and rail services in recent years, but ridership still lags behind pre-pandemic levels. With gas prices expected to remain elevated, more Austinites may turn to public transit—but the system’s capacity constraints could limit how much relief it can provide. Capital Metro’s CEO, Randy Clarke, has already warned that the agency is facing a budget shortfall due to lower-than-expected fare revenue, and the current crisis could force tough choices about service cuts or fare hikes.

For those who can’t or won’t switch to public transit, the alternatives are limited. The city’s bike lanes and pedestrian infrastructure are improving, but Austin’s sprawling layout and hot summers make active transportation a challenge for many residents. And whereas electric vehicles (EVs) are gaining popularity, the city’s charging infrastructure is still playing catch-up. The Austin Energy Plug-In EVerywhere network, which aims to install 1,000 public charging stations by 2025, is making progress, but the current crisis could accelerate demand—and strain the grid in the process.

2. Small Business: The Squeeze on Main Street

Austin’s small businesses are the backbone of the local economy, and they’re particularly vulnerable to the kind of supply chain disruptions and cost pressures that the Hormuz shock is creating. The Austin Small Business Development Center, which provides counseling and support to local entrepreneurs, has seen a surge in requests for help navigating rising fuel costs and supply chain delays. For restaurants, which operate on thin margins even in the best of times, the double whammy of higher food delivery costs and lower consumer spending could be devastating. The Austin Restaurant Association has already begun lobbying city officials for relief, including temporary suspensions of certain fees and taxes.

Retailers are feeling the pinch too. The Austin Retail Merchants Association has reported that some members are seeing a slowdown in sales, particularly for big-ticket items like furniture and appliances, which are often delivered by truck. And for local manufacturers, the rising cost of raw materials and transportation is putting pressure on profit margins. The Austin Technology Incubator, which supports startups in the clean energy and advanced manufacturing sectors, has seen increased interest in companies that can help businesses reduce their energy consumption and carbon footprints.

3. Real Estate: The Cost of Building and Buying

Austin’s real estate market has been cooling from its pandemic-era highs, but the Hormuz shock could accelerate that trend. Higher fuel costs are driving up the price of construction materials, from asphalt to steel, which could sluggish the pace of new development. The Austin Board of Realtors has already noted that some builders are delaying projects or scaling back their ambitions, particularly in the affordable housing sector. And for homebuyers, the combination of higher mortgage rates and elevated fuel costs could make homeownership even more out of reach for many Austinites.

The rental market is feeling the pressure too. With more residents struggling to afford homeownership, demand for rental housing is rising, but landlords are facing higher operating costs, from maintenance to insurance. The Austin Apartment Association has reported that some property owners are considering rent increases to offset these costs, which could exacerbate the city’s affordability crisis. And for commercial real estate, the outlook is mixed. While some sectors, like industrial and logistics, could benefit from the shift to local supply chains, others, like retail and office, could face challenges as businesses and consumers cut back on spending.

What You Can Do: Navigating the New Energy Reality

Given my background in covering the intersection of global energy markets and local economies, I’ve seen how communities can adapt to these kinds of shocks—and even turn them into opportunities. If you’re feeling the impact of the Hormuz shock in Austin, here are three types of local professionals who can help you navigate the challenges ahead:

Energy Efficiency Consultants

With fuel costs rising, now is the time to make your home or business as energy-efficient as possible. Look for consultants who are certified by the Residential Energy Services Network (RESNET) or the Building Performance Institute (BPI). These professionals can conduct energy audits to identify areas where you’re losing money—whether it’s through drafty windows, inefficient HVAC systems, or poor insulation. In Austin, where the summers are long and hot, a well-sealed and properly insulated home can save you hundreds of dollars a year on cooling costs. Ask potential consultants about their experience with local climate conditions and whether they offer rebates or financing options through programs like Austin Energy’s Home Performance with ENERGY STAR.

Supply Chain and Logistics Advisors

If you’re a small business owner, the current supply chain disruptions could be a make-or-break moment for your operations. A local supply chain advisor can help you diversify your suppliers, optimize your inventory, and find alternative transportation routes to avoid the worst of the delays. Look for professionals with experience in your specific industry—whether it’s food service, retail, or manufacturing—and ask about their track record of helping businesses reduce costs and improve resilience. In Austin, where the local economy is heavily tied to the tech and creative sectors, you’ll want someone who understands the unique challenges of sourcing everything from specialty ingredients to custom-manufactured components. The Austin Chamber of Commerce and the City of Austin’s Small Business Development Program can be good places to start your search.

Sustainable Transportation Planners

With gas prices expected to remain high, now is the time to explore alternative transportation options—whether it’s biking, carpooling, or switching to an electric vehicle. A sustainable transportation planner can help you assess your options and create a plan that works for your lifestyle and budget. In Austin, where the infrastructure for biking and walking is improving but still uneven, look for planners who are familiar with the city’s Bicycle Master Plan and Capital Metro’s transit routes. If you’re considering an EV, ask about the availability of charging stations in your neighborhood and whether your home is equipped to handle the electrical load. The Austin Energy EV Program offers rebates and incentives for home charging stations, and a good planner can help you navigate the application process.

This isn’t just about weathering the current storm—it’s about positioning yourself for the long term. The energy transition is happening, and communities that adapt early will be the ones that thrive. Austin has always been a city of innovators, and this crisis could be the catalyst that accelerates our shift toward a more sustainable, resilient economy.

Ready to find trusted professionals? Browse our complete directory of top-rated energy efficiency consultants in the Austin area today.