Bank Warns Risks to Crude Prices Remain Skewed Higher

Barclays is maintaining its 2026 average Brent crude oil price forecast at $100 per barrel, while warning that risks remain tilted toward even higher prices as disruptions in the Strait of Hormuz continue pressuring global energy markets.

Brent crude futures traded near $105 per barrel on Friday as investors grew increasingly doubtful that U.S.-Iran peace talks would produce a quick breakthrough. The continued closure of the Strait of Hormuz has severely disrupted global oil flows and tightened supply conditions.

Before the conflict, roughly 20% of the world’s energy supplies moved through the strategic shipping route. The ongoing disruption has reportedly removed around 14 million barrels per day of oil supply from the market, affecting exports from major producers including Saudi Arabia, Iraq, the United Arab Emirates, and Kuwait.

Barclays said current inventory trends suggest a global oil deficit of between 6 million and 8 million barrels per day, while U.S. crude inventories are approaching their lowest levels since 2020.

The bank also warned that even if the Strait of Hormuz reopened immediately, oil inventories would still remain historically tight due to the massive supply shock already absorbed by global markets.

Despite rising prices, Barclays noted that global oil demand has remained relatively resilient. The bank believes industrial demand could recover strongly if energy supplies normalize and shipping routes reopen.

The outlook highlights growing concerns that prolonged Middle East tensions could continue fueling inflation, raising energy costs, and increasing volatility across global financial markets.

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