War Premium
Additional cost in oil prices attributable to conflict risk.
Last refreshed: 9 April 2026
How much of today's oil price is the war?
Timeline for war premium
Mentioned in: Brent rebounds as Goldman prices ceasefire risk
Iran Conflict 2026Mentioned in: Brent rebounds to $102 after record drop
Iran Conflict 2026Mentioned in: Brent below $100 on ceasefire rumours
Iran Conflict 2026Mentioned in: Saudi FM: Gulf patience not unlimited
Iran Conflict 2026Mentioned in: Iran FM shifts: this war must end
Iran Conflict 2026- How much has the Iran war added to oil prices?
- Roughly $30-$50 per barrel above the pre-war baseline of $67.Source: background
- Why are oil prices still high after the ceasefire?
- The structural Hormuz premium remains because Iran controls transit through its toll system.Source: background
- What is a war premium on oil?
- The portion of the oil price reflecting supply disruption risk from armed conflict.Source: background
Background
A war premium is the component of a commodity's market price that reflects the risk of supply disruption due to armed conflict. In the context of the 2026 Iran war, the war premium on Brent Crude is the difference between the current price and the pre-war baseline of approximately $67 per barrel.
Before the conflict began on 28 February 2026, Brent traded near $67. By early April the price had risen above $110, with Goldman Sachs attributing $14 to $18 per barrel to the geopolitical risk premium. The premium has two components: a structural Hormuz element reflecting Iran's permanent toll system, and an escalation tail reflecting the risk of complete strait closure.
The Ceasefire announcement on 8 April 2026 briefly crashed Brent to $92, retiring the escalation tail but leaving the structural premium intact. Within 24 hours, violations pushed the price back to $97. Goldman Sachs' Q2 forecast range of $90 to $115 reflects the market's uncertainty about whether the Ceasefire premium or the war premium will dominate.
