Brent Crude Prices to Remain Elevated Amid Strait Disruptions
Hong Leong Investment Bank (HLIB) predicts that Brent crude oil prices will remain elevated in the fourth quarter of 2026, trading between US$95 and US$100 per barrel by year's end. This forecast is based on persistent disruptions to the Strait of Hormuz and rising risks in the Bab el-Mandeb Strait, which are constraining West Asia exports.
The bank notes that alternative routes such as Saudi Arabia's East-West Pipeline are also being affected, with a recent disruption caused by drone attacks. As a result, HLIB has raised its 2026 Brent assumption to US$90 per barrel from US$80, while maintaining a forecast of US$75 per barrel for 2027.
The global oil deficit has widened sharply to 4.1 million barrels per day in August 2026, driven by West Asia supply disruptions and regional production down 7.8% month-on-month. HLIB points out that Kazakhstan's higher output and the US's slight increase have partly offset this.