BofA raises Brent oil price forecast on persistent Middle East tensions

Sept. 22 (Reuters) - Bank of America raised its Brent crude oil price forecast for the second half of 2026, saying prolonged geopolitical tensions through the end of the year were now its base-case scenario.

• The bank raised its Brent forecast for the second half of the year to $95 a barrel from $83, according to a research note dated Monday.
• BofA said disruptions to shipments through the Strait of Hormuz may have peaked at about 14 million barrels per day, noting they had more recently averaged 4 million to 8 million bpd below pre-war levels.
• While alternative routes and escorted shipments through the strait have mitigated some of the shortfall, damaged infrastructure and heightened geopolitical tensions make a rapid recovery unlikely. The bank expects Brent to average about $80 a barrel in 2027.
• BofA said that if disruptions persist into spring 2027 or damage to oil infrastructure worsens, front-month Brent contracts could spike well above $150 a barrel to curb global demand.
• Goldman Sachs and HSBC raised their Brent price forecasts earlier this month, citing expectations that shipping disruptions in the Middle East will continue into next year.