Citi and ANZ have raised their Brent crude price forecasts as Middle East supply disruptions tighten the oil market. Citi lifted its Q3 2026 Brent forecast to $86 a barrel, citing a U.S. blockade of Iran and reduced flows through the Strait of Hormuz, while ANZ raised its short-term forecast to $95 a barrel.
Citi and ANZ lift Brent targets
Citi raised its third-quarter 2026 Brent crude forecast to $86 per barrel, pointing to disruptions in Middle East supply. ANZ went further, raising its short-term Brent forecast to $95 per barrel.
Citi described the current situation, which includes a U.S. blockade of Iran and reduced flows through the Strait of Hormuz, as unsustainable. The bank expects renewed dealmaking or other developments to allow the waterway to reopen in the fourth quarter. ANZ, meanwhile, said the market is entering a delicate adaptation phase as inventories decline, and it added that further demand destruction will be needed to rebuild stocks.
Diverging views on the surplus ahead
The two banks focused on different parts of the supply picture. Citi said a reopening of the Strait would leave the oil market with an estimated surplus of 3 million to 4 million barrels per day, up from about 2 million barrels per day previously.
ANZ instead focused on the scale of the supply loss during the disruption. The bank estimates the conflict will remove 2.3 billion to 2.4 billion barrels of Persian Gulf supply in 2026, with losses exceeding 2 billion barrels by the end of October.
Source: Investing.com
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