ANZ Bank has increased its forecast for Brent oil prices to $105 per barrel for the end of this year. This $10 increase is due to a hypothesis regarding the continuation of export restrictions, the availability of transportation, and fuel supply until the end of December.
Analysis of the Oil Market Situation
ANZ Bank strategists emphasized in a report that this forecast does not require new geopolitical shocks and is solely based on the continuation of existing export restrictions in the Middle East, transportation, and refined product markets. The bank also warned that any escalation in the Middle East could significantly increase oil prices.
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ANZ Bank also pointed out that the world no longer has reserves to manage new shocks. According to the bank, eight months of adapting to existing disruptions in Middle Eastern oil supply has significantly weakened reserves.
Other Banks' Forecasts
In this context, UBS has also raised its forecast for Brent oil prices to $110 per barrel for the end of 2026, an increase from the previous forecast of $100 per barrel. This change in forecasts is due to high uncertainties regarding conflicts in the Middle East, production and exports from the region, and global oil demand.
On the other hand, Goldman Sachs has predicted that Brent oil prices will reach $90 per barrel by the end of this year and that its annual average will drop to $80 per barrel in 2027. Dan Struyven, co-head of global commodities research and head of oil research at Goldman, stated that the risks in the bank's forecasts are clearly skewed towards an increase.
Goldman Sachs has also estimated that the risk premium in Brent oil prices is currently about $27 per barrel. According to Struyven, for this premium to decrease rapidly, a diplomatic solution that market participants view as sustainable is likely needed.
However, oil prices are on track for a fourth consecutive monthly increase, as Houthi attacks on Saudi Arabia have intensified and the market is preparing for a new round of potential attacks by the United States and Israel on Iran.
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