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<Research>Citi: Persistent Escalation of Israel-Iran Conflict Wreaks Volatile Oil Prices; 1-3Q Brent Forecast Raised
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In light of the ongoing escalation of the US-Israel-Iran conflict entering its second week, oil prices continued to face sharp swings, with Brent crude prices fluctuating between USD84 and USD117/ bbl, Citi said in its research report. Attacks on vessels and oil infrastructure severely disrupted oil transportation through the Strait of Hormuz, and producers temporarily suspended production of approximately 6-7 million bpd. Meanwhile, the US and the G7 are pursuing to provide a safety valves for the oil market, and the IEA agreed to release 400 million barrels of oil from strategic stocks, marking the largest release in history. If the IEA continues to be prepared and indeed provides market liquidity, it can effectively suppress rising oil prices. Meanwhile, India's increased purchases of Russian oil and China's reduced inventory reserve activities will also have a suppressive effect on oil prices. The broker raised its oil price forecast for 1-3Q26, while maintaining the 4Q26's unchanged. The forecast for Brent crude prices in 1-3Q26 was raised from the original USD73/ USD70/ USD62/ bbl to USD75/ USD78/ USD68. It was also expected that the benchmark Brent price for the next one to two weeks will be raised from the original expectation of USD80-90/ bbl to USD80-100. AASTOCKS Financial News Website: www.aastocks.com |
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