Key Takeaways
- Citigroup has increased its near-term Brent crude price target to $120 per barrel from a previous $95
- Goldman Sachs elevated its fourth-quarter Brent projection to $90 per barrel, representing a nearly $30 increase from pre-crisis levels
- The blockade of the Strait of Hormuz has essentially eliminated Persian Gulf crude shipments
- Approximately 500 million barrels in aggregate supply have been removed from markets since hostilities commenced
- Brent crude prices have climbed nearly 50% since the confrontation began in late February
Major Wall Street banks Citigroup and Goldman Sachs have significantly revised their crude oil price projections upward following prolonged disruptions at the Strait of Hormuz. On Monday, Brent crude was changing hands near $108.50 per barrel, registering approximately 3% gains for the session and marking its sixth consecutive day of advances.
Citigroup’s updated outlook calls for Brent to reach $120 per barrel within a zero to three-month timeframe. The financial institution has also adjusted its quarterly average projections to $110, $95, and $80 for the second, third, and fourth quarters of 2026, respectively. These numbers represent substantial increases from the bank’s previous quarterly estimates of $95, $80, and $75.
Citigroup assigns a 50% likelihood to its baseline projection. This forecast assumes the strategic waterway will start reopening by late May, which represents a one-month delay compared to the bank’s earlier timeline.
Citi’s research team indicates that Iran’s government possesses both economic and geopolitical incentives to maintain the effective closure of the Strait for the immediate future. The analysts suggest this strategy would constrict worldwide oil availability, accelerate the depletion of inventories, and drive prices upward.
According to Citigroup’s calculations, approximately 500 million barrels of cumulative output have been removed from global markets since the conflict’s onset. Should the Strait remain inaccessible through May, the institution forecasts aggregate losses could swell to 1.3 billion barrels.
Goldman Sachs Adjusts Price Outlook
Goldman Sachs similarly revised its oil price forecasts on April 27. The investment bank now anticipates Brent will average $90 per barrel during the fourth quarter of 2026, up from an earlier projection of $80. Goldman notes this figure stands nearly $30 above pre-crisis estimates, reflecting what market observers have termed the “Hormuz shock.”
Goldman’s analysis indicates that production disruptions of 14.5 million barrels daily from the Persian Gulf region are causing worldwide petroleum stockpiles to decline at an unprecedented rate of 11 to 12 million barrels per day throughout April. The bank forecasts a market deficit of 9.6 million barrels daily for the current quarter. Goldman’s updated outlook places Brent at $100 for this quarter and $93 during the third quarter.
Morgan Stanley Maintains Position
Morgan Stanley has opted to keep its projections unchanged. The institution anticipates Brent will average $110 during the current quarter, $100 in the third quarter, and $90 in the fourth quarter. Morgan Stanley calculates that Gulf petroleum exports have declined by 14.2 million barrels daily as a result of the blockade.
The bank noted that worldwide oil inventories have decreased by an estimated 4.8 million barrels per day, with diminished consumption explaining a portion of the discrepancy.
Citigroup’s optimistic scenario, assigned a 30% probability, envisions Brent climbing to $150 per barrel should disruptions extend through the conclusion of June. An extreme bullish case involving damage to critical infrastructure could propel prices to a sustained range of $160–$180 per barrel.
Under Citi’s baseline scenario, global petroleum reserves are projected to fall to their lowest concentrations in more than ten years by the end of July.
