Citi Lifts Q3 2026 Brent Forecast to $80 on U.S.-Iran Deal Delays

Citi has increased its average price forecast for Brent crude for the third quarter of 2026, citing persistent delays in a potential resolution to the U.S.-Iran conflict. The bank now sees the global oil benchmark averaging $80 per barrel for the period, a notable increase from its previous estimate of $75.

Revised Forecast Details

In a note released Friday, Citi attributed the upward revision to the "prolonged back-and-forth in dealmaking" between Washington and Tehran, as reported by Reuters. Despite the near-term price adjustment, the bank stated it still expects an eventual resolution to the conflict.

While the third-quarter forecast was raised, Citi maintained its longer-term price outlook. The bank's key projections are now as follows:

• Q3 2026 Average: $80 per barrel (revised from $75)
• Q4 2026 Average: $70 per barrel (unchanged)
• Full-Year 2027 Average: $65 per barrel (unchanged)

Market Context and Geopolitical Headwinds

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The revised forecast comes as oil prices trended higher, reflecting ongoing market concerns. On Friday, Brent crude futures were trading up 1.4% at $81.79 a barrel, while U.S. West Texas Intermediate (WTI) futures rose 1.33% to $78.32.

Market participants are closely watching the lack of progress in talks between U.S. and Iranian negotiators. This geopolitical uncertainty, combined with recent U.S. economic data, is providing support for crude prices.

Broader Wall Street Outlook

Citi's view that geopolitical risk will keep prices elevated is shared by other financial institutions. Earlier in the week, Goldman Sachs said it expects Brent to remain within an $80 to $90 per barrel range in the near term.

According to the Goldman Sachs note, a significant move outside of this range would likely be triggered by either a confirmed U.S.-Iran nuclear deal, which could add supply to the market, or a major escalation in regional attacks that would threaten supply.