Morgan Stanley led the retreat, lowering its third-quarter forecast to $90 per barrel from a previous estimate of $100. Analysts at the firm expect a rapid normalization of tanker traffic once the agreement, scheduled for signing this Friday in Switzerland, takes effect. Goldman Sachs followed suit, trimming its fourth-quarter outlook by $10 to $80 per barrel and dropping its 2027 average projection to $75.
Wall Street Slashes Oil Forecasts as Iran-U.S. Deal Looms
A sudden breakthrough in peace negotiations between Washington and Tehran has triggered a wave of downward revisions across major investment banks, with analysts betting that the imminent reopening of the Strait of Hormuz will flood global markets with additional supply and drive down Brent crude prices through 2027.
Citi remains the most pessimistic among the major financial institutions, forecasting Brent to slide to $70 per barrel by the end of this year and averaging just $65 throughout 2027. Market reaction has been swift, with Brent crude falling below $90 earlier this week and trading at $82.51, while WTI hovered near $80.23. The deal mandates the full reopening of the Strait of Hormuz within 30 days, a move expected to remove the risk premium that has buoyed energy markets for months.
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