Iran War Disrupts Global Oil Markets, Driving Prices Higher

The ongoing war in Iran has severely disrupted global energy markets, leading to a sharp surge in crude oil and refined product prices. According to the U.S. Energy Information Administration (EIA), reduced Middle Eastern oil supplies due to the conflict have contributed to a rapid decline in global petroleum inventories.

Global petroleum inventories have declined by approximately 400 million barrels since the beginning of the year, with significant volumes of Middle Eastern crude production and exports unable to recover before the end of the year. The EIA expects the average spot price of global benchmark Brent crude to be approximately $91 per barrel this year, an increase of nearly 5% from its previous estimate.

The agency projects that oil shipments from the Middle East will rebound in the coming months as shipping through the Strait of Hormuz gradually resumes and producing countries increasingly adopt alternative solutions such as ship-to-ship transfers. However, passage through the strait and the viability of alternative transport methods remain dependent on the subsequent trajectory of the conflict.

Several major international banks have also raised their oil price forecasts in response to the ongoing crisis. Goldman Sachs has increased its 2026 Brent/WTI crude oil price forecasts by $5 to $85/$80, while HSBC has significantly raised its Brent crude oil price forecasts for this year and next.

Bank of America analysts believe that if small-scale conflicts restricting oil supply persist until the end of the year, the trading range for Brent crude could be between $95 and $120 per barrel. Meanwhile, if a broader conflict erupts, causing significant damage to energy infrastructure, oil prices could surge to as high as $150 per barrel.