Energy Price Rebound Risks Reviving EM Inflation Concerns

Research evidence excerpt

Energy Price Rebound Risks Reviving EM Inflation Concerns

Economics Research

29 July 2026 | 9:06AM HKT

EM MACRO NAVIGATOR

n Re-escalation in the Iran conflict pushed oil prices over $100/bbl last week. Andrew Tilton

+852-2978-1802 |

While Brent crude has receded to below $90/bbl on hopes of a near-term andrew.tilton@gs.com

Goldman Sachs (Asia) L.L.C.

de-escalation, the trajectory from here is far from certain. On balance, our

Kamakshya Trivedi

commodities research team sees near-term risks skewed to the upside, with +44(20)7051-4005 |

kamakshya.trivedi@gs.com

Brent potentially surpassing $120/bbl in 2026Q4 if escalation intensifies. Goldman Sachs International

Kevin Daly

n Higher oil prices would likely revive investor concerns regarding the EM inflation +44(20)7774-5908 | kevin.daly@gs.com

Goldman Sachs International

outlook and policy rate path. Since the conflict started in February, inflation has

Clemens Grafe

been relatively subdued—partly because the impact of the energy supply shock +44(20)7774-3435 |

clemens.grafe@gs.com

on global oil prices has been tempered by weaker Chinese import demand, Goldman Sachs International

strong American supply and the release of strategic petroleum reserves. But Sunil Koul

+44(20)7051-4931 | sunil.koul@gs.com

inflation has also been mitigated by a number of EM-specific factors, including Goldman Sachs International

the introduction of policy measures to stabilise domestic fuel prices, low food Goohoon Kwon, CFA

+852-2978-0048 |

inflation, limited broadening of inflationary pressures, and the lagged effects of goohoon.kwon@gs.com

prior EM FX strengthening.

Andrew Matheny

+44(20)7051-6069 |

n On balance, we believe these factors will continue to keep inflationary pressures andrew.matheny@gs.com