Three major brokerages raised oil price forecasts due to Iran conflict, here are the latest data

Investing.com - As Iran conflicts disrupt oil flow through the Strait of Hormuz, three major brokerages have raised their oil price forecasts. The already fragile global supply landscape has further tightened, pushing crude oil prices higher.

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Swiss broker UBS states that the crude oil market is “under tension,” with severe restrictions on tanker transportation. Strategist Jon Gordon said in a report: “Limited progress in unlocking the world’s most critical energy chokepoint has driven up oil prices.” As of Tuesday when this article was written, Brent crude was trading at $102.6.

UBS currently expects Brent crude to reach $90 per barrel by the end of June 2026, then fall back to $85 by the end of September 2026 and December 2026, and drop to $80 by the end of March 2027. Gordon said, “Overall, we believe the path with the least resistance for oil prices now leans further upward.” He pointed out that supply disruptions are worsening and spare capacity is limited.

Gordon emphasized that tanker loading activity through the strait is “almost at a standstill,” and alternative export routes are operating near full capacity. He added that the coordinated release of about 400 million barrels of oil from OECD reserves can only partially offset supply shocks, as the release rate is insufficient compared to potential production losses, which could reach 10 million barrels per day.

The strategist also noted that prices for refined products are rising, with diesel, jet fuel, and liquefied petroleum gas possibly remaining high or even exceeding crude oil gains.

Gordon believes that the combined effects of supply disruptions, limited reserve support, and geopolitical risks mean oil prices could “remain elevated for a longer period,” even if the Strait of Hormuz reopens in the coming weeks.

In this context, he stated that gold remains “an effective diversification and hedging tool,” and continues to favor including energy, gold, and other physical assets in broadly diversified portfolios.

In another report, Barclays also raised its oil price forecasts, stating that the conflict is accelerating an already ongoing tightening trend. The bank raised its 2026 Brent crude forecast to $84 per barrel, expecting prices to “normalize above pre-conflict levels,” with long-term prices close to $80 rather than the previous $70.

Analysts led by Lydia Rainforth wrote: “Short-term supply surplus concerns have now been replaced by actual physical disruptions, which significantly tighten all supply-demand balance estimates, requiring inventory rebuilding after the disruptions.”

Barclays estimates that about 8 million barrels per day of oil production in the Middle East has been shut down, and broader disruptions are affecting the flow of liquid fuels and liquefied natural gas. The bank also raised its refining margin assumptions by over 110%, to about $11 per barrel.

In the US, Mizuho raised its 2026 outlook for Brent crude and WTI by approximately 14% and 12%, respectively, to $73.25 and $68.25 per barrel. The broker stated that even short-term disruptions could significantly tighten the market, noting that supply shifts have reduced expected 2026 oversupply, making a return to lower price scenarios less likely.

The bank indicated that even a one-month transfer of oil production (estimated at about 7.1 million barrels per day) would significantly reduce the expected oversupply in 2026, tightening market balance.

Mizuho pointed out that the likelihood of prices falling sharply into the $50 range has become “extremely unlikely,” and mid-year rebalancing could keep Brent crude in the $70-75 range. The key question remains whether the conflict will lead to structural long-term price increases; Mizuho leans toward higher prices but says it is “too early to draw conclusions.”

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