Oil Prices Poised for Further Spike Amid Middle East Tensions
Oil prices are expected to rise further in the second half of this year due to ongoing disruptions in the Strait of Hormuz and attacks in the Red Sea. The latest Reuters poll of 31 economists and analysts forecasts Brent crude to average $85.22 a barrel in 2026, up from June's estimate of $84.50.
The US-Iran conflict has sharply reduced traffic through the Strait of Hormuz, which previously carried about a fifth of global crude oil and natural gas supplies. The Houthi militia in Yemen has also disrupted shipping through the Bab el-Mandeb Strait, creating a second chokepoint for oil flows.
According to UniCredit analyst Tobias Keller, the key support remains the geopolitical risk premium associated with the Iran conflict, which is likely to persist through the second half of the year and keep volatility elevated.Normalization of oil flows from the Gulf will take about four to six months after a durable ceasefire between the US and Iran, said Phil Flynn, senior analyst at Price Futures Group.