Goldman Sachs has revised its inflation outlook for 2026 due to the ongoing war between Iran and Israel, stating that the recovery of crude oil and related products through the Strait of Hormuz will be slower than expected. The impact on the U.S. and global economies will be modest if the war ends by June, but the longer the war goes on, the Strait is closed to maritime traffic, which will cause more damage to the US. Goldman Sachs' scenarios work with Brent crude, the global benchmark, which has been trading at about $110, about 10% higher than light sweet crude. The core US. consumption Expenditures index is expected to rise from 2.5% year-over-year to 2.6%. The headline PCE would rise to 3.4% and 3.7% and 4.3% under its worst-case scenarios.