Citi, ANZ Raise Brent Crude Forecasts on Middle East Supply Disruptions

Citi and ANZ have raised their price forecasts for Brent crude oil, responding to ongoing supply disruptions in the Middle East that are tightening the global market.

Banks Revise Forecasts

According to an Investing.com report, Citi lifted its third-quarter 2026 forecast for Brent to $86 per barrel. The bank described the current market conditions, which include a U.S. blockade of Iran and restricted oil flows through the Strait of Hormuz, as unsustainable.

Separately, ANZ raised its short-term Brent crude forecast to $95 per barrel. Analysts at the bank noted that the market is entering a "delicate adaptation phase" as global inventories decline, suggesting that further demand destruction will be necessary to rebuild stockpiles.

Supply Impact Quantified

The upward revisions are rooted in significant estimated supply losses from the Persian Gulf. Key points from the banks' analyses include:

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• ANZ estimates the ongoing conflict will remove 2.3 billion to 2.4 billion barrels of supply from the region in 2026.
• The bank projects that these supply losses will surpass 2 billion barrels by the end of October.

This reduction in available crude is a primary driver behind the increasingly bullish price targets from market observers.

Future Scenarios

While the immediate outlook is for higher prices, Citi anticipates a potential shift later in the year. The bank expects "renewed dealmaking or other developments" to allow the Strait of Hormuz to reopen in the fourth quarter.

Should the waterway reopen, Citi projects that the oil market would be left with a significant surplus estimated at 3 million to 4 million barrels per day. This would be a substantial increase from the previously expected surplus of about 2 million barrels per day and could dramatically alter the market balance.