HSBC Warns of Higher Oil Prices as Hormuz Crisis Drags On

HSBC has raised its forecast for Brent Crude oil prices in 2026 to $90 per barrel, citing the ongoing Strait of Hormuz crisis as a major factor. According to HSBC analyst Kim Fustier, the oil markets are unlikely to rebalance until the middle of 2027.

Fustier notes that the bank's base-case scenario for the coming weeks and months is a fragile understanding between the US and Iran, which could break down at any moment. This would lead to continued tightness in the oil markets for nearly another year.

The analyst forecasts that oil flows through the Strait of Hormuz will rise to about 8 million barrels per day by the end of 2026, up from 6 million bpd now. However, this estimate is below some other projections and current flows tracking that suggest around 10 million bpd of crude and petroleum products move through Hormuz at present.

In HSBC's 'stalemate' scenario, with diplomacy failed and flows constrained as-is, Brent could jump to $120 per barrel. This is not the bank's base-case scenario, but it is close to Goldman Sachs' warning from earlier this week that oil prices could surge to as much as $120 per barrel if attacks on shipping in the Middle East intensify.