Banks Slash Oil Price Forecasts After U.S.-Iran Breakthrough
World's Largest Tanker Operator Cautions Against Hormuz Rush What I Cover Irina Slav has been writing about global energy markets since 2007, covering the oil and gas industry, energy security, commodities, and the… Morgan Stanley and Goldman Sachs cut their forecast for oil prices towards the end of the year and 2027 following developments in the peace negotiations between the United States and Iran earlier this week.
Morgan Stanley now seesBrent crudeaveraging $80 per barrel in the last quarter of 2026, and $90 per barrel in the third quarter, Bloombergreported, citing a note from the bank’s commodity team.
Morgan Stanley’s earlier forecast was for an average of $100 per barrel of Brent in the third quarter, while the fourth-quarter price forecast was unchanged.
“Much is still to be negotiated, and key risks remain, but for now, this is a key step towards a de-escalation of the conflict and higher oil exports via the Strait of Hormuz,” the analysts said, expecting a speedy recovery in tanker flows once the strait is reopened.
Goldman Sachs, meanwhile,cutits price forecast for the fourth quarter to $80 per barrel from $90 per barrel, and the 2027 average forecast for Brent crude to $75 per barrel from $80 in earlier forecasts.
According to the bank’s commodity analysts, tanker traffic via the Strait of Hormuz would recover fully by the end of July.
Citi is even morebearishthan its peers on oil prices.
On Monday, the bank cut its oil price forecast to $75 per barrel of Brent in the third quarter of this year, falling further to an average of $70 per barrel in the final quarter.
For 2027, Citi expects an average Brent price of $65 per barrel.
That’s down from an earlier 2027 forecast of $80 per barrel of Brent.
The international benchmark earlier this weekfellto the lowest since early March following the news of a preliminary peace deal between Washington and Tehran.
Set to be signed on Friday in Switzerland, the deal will see Iran reopen Hormuz within 30 days.
| Product | Price | Change |
|---|---|---|
| Brent Crude | $102.14/bbl | +0.34% |
| WTI Crude | $96.90/bbl | +0.21% |
| EN590 Diesel | $846/MT | +0.18% |
| Jet Fuel A-1 | $1090/MT | +0.55% |
| Mazut M100 | $450/MT | -0.15% |
| Bitumen 60/70 | $470/MT | +0.08% |
| Sulphur Gran 99.5% | $470/MT | -0.44% |
| Urea 46% Gran | $650/MT | +1.12% |
| NPK 16-16-16 | $460/MT | -0.28% |
| Nat Gas TTF | $15.42/MMBtu | +0.92% |
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