Barclays Ups 2026 Brent Oil Price Forecast to $100 Over Hormuz Supply Risks
Barclays Raises Brent Crude Forecast Amid Strait of Hormuz Tensions
Forecast Revision and Market Drivers
May 1 (Reuters) - Barclays on Friday raised its 2026 Brent crude forecast to $100 per barrel from $85, citing the impasse in the Strait of Hormuz.
Impact of Iranian Negotiations and U.S. Actions
An Iranian proposal on negotiations with the U.S. pressured Brent crude oil futures on Friday, but prices were higher for the week, with Tehran still blocking the strait and the U.S. Navy blocking exports of Iranian crude. [O/R]
Ceasefire and Supply Flows
A fragile ceasefire is largely holding, but rhetoric remains heightened and flows through the strait are at a trickle, the bank said.
Market Deficit and Supply Shock
Accelerating global inventory draws have already offset most of last year’s U.S. stock builds, Barclays said, estimating the oil market is running a deficit of around 6.6 million barrels per day that is likely to widen as the supply shock continues.
Price Shock and Market Balance
The bank cautioned that the longer the disruption lasts, the bigger and more persistent the price shock will be, stressing that $100 a barrel should not be seen as a level at which supply and demand have found a new balance.
OPEC Dynamics and Future Price Scenarios
UAE’s Planned OPEC Exit
While the United Arab Emirates' planned exit from OPEC could help narrow the medium‑term gap between non‑OPEC supply growth and demand, it is unlikely to fully bridge it and would reduce spare capacity, Barclays added.
Forward Prices and Potential Upside
The bank noted that forward‑implied average Brent prices for 2026 stood near $94 a barrel, below levels implied by a scenario in which the strait normalised by the end of April. Barclays added that if disruptions persist through the end of May, prices could reprice towards $110 a barrel.
(Reporting by Anmol Choubey in Bengaluru; Editing by Mark Porter, Rod Nickel)
