Oil Prices Hike as Geopolitical Tensions Add Premium

Oil price forecasts have been revised upward due to growing concerns over geopolitical tensions. According to a survey of 34 economists and analysts, Brent crude is expected to average $63.85 per barrel in 2026, up from January's forecast of $62.02.

This represents an increase of around $1.83 per barrel compared to the previous month's projection. The price of U.S. crude is also expected to rise, averaging $60.38 per barrel in 2026, a $1.66 per barrel increase from January's estimate of $58.72.

The survey found that geopolitical tensions have added a risk premium of between $4 and $10 per barrel to oil prices. However, analysts also expect an oversupply of around 0.8 million to 3.5 million barrels per day to continue to weigh on the market in the latter part of the year.

China's stockpiling efforts are a key factor in this surplus, with the country having added around 1 million barrels per day to its reserves recently. A slowdown in these efforts could further increase the oversupply and put downward pressure on prices.