HSBC on Tuesday revised upward its long-range oil price outlook, raising its 2026 average Brent forecast by $15 to $80 per barrel and increasing its WTI projection by $14 to $76 per barrel.
At 13:28 GMT Brent was trading down 7% at $91.99 per barrel, while WTI was 6.2% lower at $88.89 per barrel.
Both benchmarks have experienced significant gains since the outbreak of the conflict involving Iran last week. Brent has climbed by more than 27% over that period, while WTI has risen by about 33%. On Monday both benchmarks briefly exceeded $119 per barrel, marks not seen since mid-2022.
The recent price surge followed a closure of the Strait of Hormuz, a strategic maritime chokepoint that handles roughly one fifth of global oil supply. The shutdown has disrupted vessel traffic in the area and prompted several major OPEC producers to cut shipments.
Specifically, Saudi Arabia, Iraq, Kuwait and the United Arab Emirates have all reduced shipments as the flow of vessels across the region stalls. Those lower export volumes are a central element in the tighter supply conditions that have driven the recent spike in crude prices.
Context and market reaction
HSBCs forecast adjustments reflect the banks recalibration of medium-term price assumptions in response to the current supply disruption and heightened market uncertainty. The immediate market reaction saw sharp intraday pullbacks from the recent peaks, with both Brent and WTI retreating from levels above $119 to the mid-90s and high-80s respectively as of the reported timestamp.
Implications for sectors
- Energy markets - price forecasts and short-term volatility are directly affected by supply interruptions.
- Maritime and shipping - vessel traffic disruptions in the Strait of Hormuz are influencing exports and logistics.
- Commodity trading and refining - benchmark swings alter refining margins and trading strategies.
Data limitations
The information reported reflects specific price levels and percentage moves up to 13:28 GMT and the market developments tied to the Strait of Hormuz closure. Where details are limited, the account confines itself to the stated changes in shipments by named OPEC producers and the observed price movements.