Analysts are continuing to scramble to adjust expectations amid the Iran war.
Enverus Intelligence Research is the latest to unveil its new expectations, forecasting higher prices for Brent – the global benchmark that usually trades at a $5 premium to West Texas Intermediate.
Given the impacts of the war, near-zero flows through the Strait of Hormuz, a record G7 SPR release, and expectations for a muted U.S. production response, EIR now expects Brent to average $95 per barrel through this year and $100 next year, assuming the Strait of Hormuz remains largely closed for three months.
For each month oil flows through the Strait remain constrained, EIR’s outlook changes by $10 to $15 a barrel.
EIR analysts attribute this to accelerating global stock draws and an unresponsive supply outlook.
“The world has an oil flow problem that is draining stocks. Whenever that oil flow problem is resolved, the world is left with low stocks. That’s what drives our oil price outlook higher for longer,” said Al Salazar, director of research at EIR, in the update.
With countries around the globe — including the U.S. — releasing 400 million barrels from strategic reserves, Salazar noted it will take considerable time to replenish those barrels. EIR estimates cumulative global oil stock draws at roughly 1 billion barrels through 2027, with non-Organization for Economic Cooperation and Development inventories, particularly in Asia, absorbing nearly half of the impact.
“Usually, it takes years to draw down 400 million barrels,” he told the Reporter-Telegram.
Even with WTI between $90 and $100, U.S. oil producers are not expected to materially increase output. EIR forecasts liquids output to grow 370,000 barrels per day by the end of 2026 and 580,000 barrels per day by the end of 2027, reflecting drilling to production lags, industry consolidation and disciplined investment.
Salazar said there is a chance oil prices could rise even further, depending on how long the Strait of Hormuz remains closed and how long it takes Middle Eastern countries to repair any damage done to their energy infrastructure and resume oil flows.
“We’re not calling for a recession because demand tends to go up at $100,” he said. “We have to watch how demand plays out.”
Americans and Canadians like to complain about gasoline prices, he observed. But those prices aren’t an issue “until we start losing jobs due to high energy prices.”
According to EIR, global oil demand growth for 2026 has been reduced to approximately 500,000 barrels per day, down from 1 million barrels per day.
