Oil prices could approach over $100 by the end of the year due to escalating tensions in the Middle East – Bloomberg
Kyiv • UNN
Rapidan Energy Group raised its Brent price forecast for the fourth quarter to nearly $100 due to the risk of disruptions in the Strait of Hormuz. Goldman Sachs suggests a rise above $120 in the event of a prolonged conflict.
Consulting firm Rapidan Energy Group has raised its forecast for Brent crude oil prices for the fourth quarter to nearly $100 per barrel due to the risk of prolonged shipping disruptions in the Strait of Hormuz following the collapse of the ceasefire between the US and Iran. This is reported by Bloomberg, writes UNN.
Details
Analysts believe that the escalation of the conflict could keep oil prices high until the end of the year, and the global market will remain in deficit for at least another year.
The company raised its forecast for the average Brent price in the fourth quarter from $85 to nearly $100 per barrel. According to Rapidan, if hopes for a new peace agreement between the US and Iran finally disappear, the market will begin to factor in a worsening supply situation.
The collapse of the memorandum of understanding between the US and Iran has fundamentally changed our outlook
According to their forecasts, shipping through the Strait of Hormuz will recover much more slowly than previously expected: by October, traffic volumes may reach only about 35% of pre-war levels, and approximately 65% only by 2027.
Goldman Sachs allows for Brent to rise above $120
As Bloomberg notes, energy markets came under pressure after the collapse of the ceasefire regime between the US and Iran and a new escalation of hostilities, including Houthi attacks on commercial shipping in the Red Sea.
Earlier, Goldman Sachs analysts stated that in the event of a prolonged conflict, the Brent price could exceed $120 per barrel. The day before, benchmark oil rose above $100 per barrel for the first time in two months.
Rapidan also notes that the risks of high prices are partially restrained by weak demand from China, which, according to the company's forecast, will continue to reduce crude oil inventories until the end of 2026.