TLDR
- Citigroup increased its near-term Brent crude projection to $120 per barrel from $95
- Goldman Sachs elevated its fourth-quarter Brent forecast to $90 per barrel, representing a nearly $30 jump from pre-crisis levels
- Persian Gulf crude shipments through the Strait of Hormuz have essentially stopped
- Approximately 500 million barrels of oil supply have disappeared since hostilities commenced
- Brent has surged nearly 50% from levels seen when the conflict erupted in late February
Major investment banks including Citigroup and Goldman Sachs have adjusted their crude oil projections upward as the Strait of Hormuz remains effectively sealed with no immediate resolution in sight. Trading activity on Monday showed Brent crude hovering around $108.50 per barrel, marking a 3% intraday increase and extending gains for the sixth consecutive session.
Citigroup’s revised outlook places Brent at $120 per barrel within the next zero-to-three-month timeframe. The financial institution has also updated its quarterly average projections to $110, $95, and $80 for the second, third, and fourth quarters of 2026 respectively. These numbers represent significant increases from the bank’s earlier predictions of $95, $80, and $75.
The bank assigns a 50% likelihood to its primary projection. This baseline scenario operates under the assumption that the Strait will begin reopening toward the end of May, representing a one-month delay from Citi’s previous timeline.
Citigroup analysts highlighted that Iran’s leadership possesses compelling economic and geopolitical motivations to maintain the current blockade. The bank’s research suggests this strategy would constrict worldwide petroleum availability, accelerate the depletion of stored reserves, and drive market prices substantially higher.
According to Citi’s calculations, cumulative supply disruptions have eliminated approximately 500 million barrels since the crisis began. Should the waterway remain inaccessible through May, the institution forecasts aggregate losses could balloon to 1.3 billion barrels.
Goldman Sachs Raises Forecasts
Goldman Sachs similarly revised its oil price projections on April 27. The investment bank now anticipates Brent will average $90 per barrel during the fourth quarter of 2026, representing an upward revision from its prior $80 estimate. Goldman notes this updated figure stands nearly $30 above pre-“Hormuz shock” expectations.
Goldman’s analysis indicates that 14.5 million barrels daily of Persian Gulf crude production has been knocked offline, causing worldwide petroleum stockpiles to decline at an unprecedented rate of 11 to 12 million barrels per day throughout April. The firm anticipates a supply deficit of 9.6 million barrels daily for the current quarter. Goldman’s updated forecasts position Brent at $100 for this quarter and $93 for the third quarter.
Morgan Stanley Holds Steady
Morgan Stanley maintained its existing projections without adjustment. The institution continues to forecast Brent averaging $110 during the current quarter, $100 in the third quarter, and $90 in the fourth quarter. Morgan Stanley’s assessment suggests Gulf petroleum exports have declined by 14.2 million barrels daily resulting from the closure.
The bank noted that worldwide inventories have decreased by an estimated 4.8 million barrels per day, with softer consumption patterns explaining a portion of this imbalance.
Citigroup’s optimistic scenario, assigned a 30% probability, envisions Brent climbing to $150 per barrel should disruptions continue through the end of June. An extreme scenario involving physical damage to critical infrastructure could propel prices to a sustained range of $160–$180 per barrel.
Under Citi’s baseline projection, worldwide petroleum reserves are positioned to fall to their lowest concentrations in more than ten years by the conclusion of July.
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