- Rapidan Energy Group now expects Brent crude to average around $100 per barrel in late 2026.
- Continued disruptions in the Strait of Hormuz remain the biggest factor supporting higher oil prices.
- Analysts warn Brent could reach $105, while some Wall Street forecasts see prices exceeding $120.
- Weaker Chinese demand may soften the impact, but global oil markets are still expected to remain in deficit.
Fresh geopolitical tensions between the United States and Iran are reshaping expectations for the global oil market, with analysts warning that crude prices may remain elevated well into next year. A renewed breakdown in relations between Washington and Tehran has raised concerns over energy supplies, particularly as disruptions continue in one of the world’s most important oil shipping routes.
Rapidan Energy Group, a Washington-based energy and geopolitical consulting firm, has significantly increased its outlook for Brent crude, citing prolonged risks to shipping through the Strait of Hormuz. The revised forecast suggests that oil prices could stay close to the $100 per barrel mark during the final months of 2026, reflecting growing uncertainty over the stability of global energy markets.
Rapidan Raises Oil Forecast as Regional Risks Intensify
Rapidan Energy Group has revised its fourth quarter Brent crude forecast from $85 per barrel to around $100 per barrel. The firm believes that disruptions affecting the Strait of Hormuz will last longer than originally expected, preventing a full recovery in global oil transportation.
Analysts at the firm explained that the collapse of the ceasefire between the United States and Iran has fundamentally changed their market outlook. According to their latest assessment, the biggest uncertainty is no longer whether tensions will continue but how far the conflict could escalate.
If military actions remain limited to strategic targets, the market may avoid the most severe supply shocks. However, if attacks expand to include civilian infrastructure such as electricity or water facilities, investors could respond by pushing oil prices even higher.
Rapidan also warned that Brent crude could climb to approximately $105 per barrel in the coming months if hopes for a diplomatic breakthrough continue to fade. A prolonged period of uncertainty would likely strengthen expectations of tighter global supplies and sustained price pressure.
Strait of Hormuz Remains the Biggest Concern
The Strait of Hormuz continues to play a central role in the global energy market because it handles a significant share of international crude oil exports. Any disruption to shipping in this narrow waterway immediately raises concerns over supply availability and transportation costs.
Rapidan expects only a gradual recovery in shipping activity over the next two years. Its projections indicate that traffic through the strait may recover to only about 35 percent of pre conflict levels by October 2026. A more meaningful recovery is not expected until 2027, when shipping volumes could reach roughly 65 percent of normal levels.
These assumptions reflect expectations that geopolitical tensions will remain elevated rather than being resolved quickly. As a result, oil traders are increasingly pricing long term supply risks into the market.
The challenges are not limited to the Strait of Hormuz. Ongoing attacks in the Red Sea have also disrupted maritime trade, adding another layer of uncertainty to global shipping networks and increasing pressure on energy markets.
Wall Street Sees Further Upside for Oil Prices
Rapidan is not alone in expecting stronger oil prices. Several major financial institutions have also adjusted their forecasts as geopolitical risks continue to mount.
Among them, Goldman Sachs has warned that if supply disruptions become more severe or last longer than expected, Brent crude could move above $120 per barrel. Such projections reflect growing concerns that global production and transportation networks may struggle to keep pace with demand if regional instability persists.
Brent crude has already climbed above $100 per barrel for the first time in two months, supported by rising tensions between Washington and Tehran. The benchmark is also on course to record monthly gains exceeding 30 percent, highlighting the speed at which market sentiment has shifted.
Higher oil prices could have wider consequences for businesses and consumers, influencing fuel costs, transportation expenses, manufacturing prices, and inflation across multiple economies.
China Could Help Balance the Market
Despite the increasingly bullish outlook for oil prices, Rapidan believes one factor could help limit further gains. Slower demand growth in China may ease some of the pressure created by supply disruptions.
The consultancy expects the global oil market to remain in deficit for at least another year. However, weaker Chinese consumption may reduce the severity of shortages compared with earlier expectations.
Rapidan also predicts that if Brent crude remains within the $90 to $100 per barrel range, China is likely to continue drawing down its crude oil inventories through 2026. Stockpile reductions are expected to fall below 500,000 barrels per day before the country resumes building reserves in early 2027.
Even with softer demand from China, analysts believe ongoing geopolitical uncertainty will remain the dominant force influencing oil prices. Unless diplomatic progress restores confidence and improves shipping conditions, energy markets are likely to remain highly sensitive to developments in the Middle East.
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