Fitch Ratings has projected that Brent crude oil prices will remain elevated between USD100-110 per barrel in the coming months due to the ongoing closure of the Strait of Hormuz. The closure is part of the broader Iran-Israel-United States conflict, impacting a critical chokepoint for global oil shipments. The forecast suggests that once the crisis subsides, prices could decrease to approximately USD70 per barrel by September. Markets appear to interpret this as an indication of significant supply disruption, resulting in fluctuating expectations for oil price movements throughout the year.
Key Takeaways
Fitch’s forecast of sustained high Brent prices during the Hormuz closure suggests ongoing disruptions, consistent with decreased likelihood of normal traffic by June 15.
The projection of high prices supports the possibility of crude oil reaching new all-time highs, although the expected price drop by September suggests a tempered long-term impact.
The market pricing for WTI Crude Oil hitting as low as $20 in June is notably low, consistent with Fitch’s prediction of elevated prices during the crisis.
