Recent developments regarding U.S.-Iran relations have led to fluctuations in oil prices, with Brent crude futures dropping to around $94 a barrel before rebounding to approximately $97 following U.S. strikes in Iran.
Bank of America Securities suggests two scenarios: a full peace deal that could lower Brent prices to an average of $82 per barrel in 2026, or a partial reopening of the Strait of Hormuz that could keep prices elevated at around $103 per barrel this year.
Francisco Blanch, a commodity strategist at Bank of America, maintains a baseline price of $92.50 per barrel for Brent crude this year, indicating that he does not foresee a collapse to pre-war levels. He emphasizes that any reopening of the Strait could significantly boost oil demand over the next 18 to 24 months, sustaining higher prices in the market